It's good to talk: financial planning and wills

We are all familiar with the stereotypical view of the British as a reserved people – the so-called 'British reserve'. As a consequence, there are two things Brits tend to be reluctant to discuss: death and money.

The importance of talking about estate planning is obvious. However, as a private client lawyer, I am acutely aware that many people shy away from creating a will because it forces them to broach difficult subjects. An individual must consider and discuss their health, relationships and finances when planning what will happen to their money and assets when they die.

In the last year, many practitioners will have experienced an unprecedented surge in the number of clients preparing wills and reviewing their estate planning generally. During the March 2020 lockdown in particular, many in the private client sphere reported extreme volumes of enquiries relating to will and estate planning. 

The pandemic encouraged many people to take action they may not otherwise have taken, and I am interested whether this has had a knock-on effect on changing people’s attitudes towards wills and financial planning and led to more openness around discussing death and money.

Post-pandemic attitudes

In April 2021, legal financing company Ampla Finance published a research paper including the results of a YouGov survey of over 2,100 UK adults, which looked at attitudes to wills and financial planning. 

Despite the widespread impact of the pandemic across all strands of society, the report found attitudes to probate and inheritance hadn’t significantly changed.

One of the most startling findings was that only 12 per cent of respondents were encouraged to review their will or funeral arrangements as a result of the covid-19 crisis.

The research further revealed 44 per cent hadn’t discussed their financial arrangements with parents or partners in the event of their death and only 11 per cent with a parent knew all the details of their parents ‘wider finances’.

Despite the pandemic, difficult conversations about finances and succession planning are still not happening. Those of us who have been dealing with the unprecedented volume of will enquiries may find the survey results surprising.

As the pandemic continues to disrupt society, with numerous reports showing many are struggling with reduced income, job uncertainty or growing personal debts, the crisis has shone a spotlight on the country’s personal finances.

Despite this backdrop, the report highlights a significant proportion of UK adults continue to show a lack of knowledge around family finances. 

Simplify probate 

The report highlights a widespread lack of awareness around the probate process, as well as a lack of understanding about how complex the process can be. 

Due to the excess deaths caused by the pandemic, many have recently dealt with the probate process for the first time and have struggled to cope with the complexity.   

The combination of the closure of numerous probate registries and many staff working from home during the pandemic has also undoubtedly led to further difficulties for those struggling with the process without the aid of an experienced practitioner.

Only 11 per cent of respondents admitted they had enough understanding about the probate process in order to complete it, but interestingly from a practitioners’ perspective, only 14 per cent planned to appoint a solicitor to assist. 

So, how does this lack of understanding around the probate process compare against the number of individuals who have reviewed their wills or funeral arrangements during the pandemic?

Interestingly, only 26 per cent of those respondents who had reviewed their will or funeral arrangements in light of the pandemic knew every bank their parents banked with, and almost half (49 per cent) would not be able to find their parents’ bank passwords if they were needed for probate.

This suggests that even among the most proactive of individuals, when it comes to dealing with probate and its practicalities there is still a lack of essential knowledge around family finances.

The survey data suggests greater education around the probate process is sorely needed.

Of those respondents who had been encouraged to review their wills due to the pandemic, only 57 per cent said they knew how they would undertake the probate process if they had to in the near future. Despite being proactive with their own arrangements, they were seemingly reticent to confront the possibility that a parent or loved one might die.

Of the same group reviewing their wills in 2020, almost half admitted they didn’t have a moderate understanding of the probate process. The report concluded individuals may be struggling to find greater information on the probate process, as their willingness to review wills and funeral arrangements implied they were incentivised to explore the topic. 

It is also evident many people who rushed to make wills in the pandemic named executors without consulting them first. Executors are typically trusted friends or relatives who are tasked with sorting out a will after someone's death, including doing the administration and distributing assets to beneficiaries.

But three out of four people writing wills don't discuss their wishes with loved ones, and many also fail to inform their chosen executors, even though it can be a time-consuming and stressful business.  Many, therefore, find themselves undertaking the role of executors, when they had no idea about their appointment prior to the individual’s death.

Time to start a conversation

The research report demonstrates the British reserve is still very evident despite the pandemic; and discussing financial plans in the event of a bereavement is still a conversation families are not having.

This lack of awareness regarding loved ones’ finances coupled with insufficient understanding of the wider probate process, will lead to individuals facing significant delays in obtaining a grant of probate and releasing inheritance to beneficiaries.

The report concludes the great British public need a greater education about probate and the importance of understanding family finances. Ampla Finance says its hope is that the report has gone some way to starting the conversation. 

This sentiment is to be commended. Pactitioners dealing with private clients have a role to play in advancing those conversations and facilitating a greater awareness and understanding of wills, financial and succession planning.

Matthew Duncan is a partner at Druces druces.com