Inheritance disputes have risen by 140%. Here’s how your clients can avoid one

It’s safe to say that most people want to avoid their family falling out over a subject like money.

While many believe that would never happen within their family unit, a new study suggests that financial disputes – in particular, those on the topic of inheritance – rose by 140% in the 10-year period between 2014 and 2024.

The research, published by Today’s Wills and Probate, suggests that this figure could even under-represent the number of conflicts that actually happened within that time frame, as it only accounts for those that reached a courtroom. Many disputes are settled privately but could still have a devastating effect on the individuals involved.

Indeed, families can contest a will for a number of reasons, including questions over the will-writer’s mental capacity and issues of coercion. But these disputes, if they go to court, can cost families tens of thousands of pounds.

If your clients are forming their estate plans, here’s how they can put measures in place to prevent disputes.

Having the “awkward inheritance conversation” now could prevent lengthy disputes later

Your clients may be avoiding talking about the inheritance they plan to leave behind. After all, these conversations may prove awkward to begin with, and your clients might even be worried about stoking the fire of conflict among family members.

Nevertheless, braving the topic of inheritance now could save their families a whole lot of heartache (and perhaps money) down the road.

Here are some tips for initiating the inheritance conversation you might wish to share with your clients:

• Choose a calm, quiet moment to have a chat
• Talk to a spouse or partner – usually the main beneficiary – first, then discuss the topic with children as a team
• Know exactly what you’re going to say, and prepare to explain your rationale
• Allow an expert, such as a financial planner, to mediate the conversation.

Subjects your clients might wish to cover include:

• How assets will be divided upon death
• Whether beneficiaries will receive lifetime gifts, when these will be transferred, and their proposed value
• Specific wishes for how certain assets, such as the family home, should be treated.

Although it might be tough to begin with, these discussions keep everyone on the same page and are likely to reduce the chance of disputes happening later.

It helps to treat their will as a live document

Your clients might assume that once they’ve created their will, they can wash their hands of the whole affair and move on. Unfortunately, that isn’t the case, and leaving a will to become outdated may be the cause of confusion and conflict after they pass away.

So, it could be wise to remind your clients that their will is a live document that should be reviewed and updated as their circumstances change.

Situations that may prompt an amendment to a will include:

• The birth of a child or grandchild
• Divorce and/or remarriage
• The death of, or estrangement from, a beneficiary
• The sale or acquisition of a property or another significant asset.

Your clients may gain immense peace of mind knowing that their will is up to date. Even if the worst happened and they passed away very suddenly, their family would be less likely to enter a dispute that could cost thousands and break down lifelong relationships.

A letter of wishes may add crucial context to your clients’ estate plan

Finally, although it is not legally binding, a letter of wishes could help beneficiaries see the big picture and lessen the chance of arguments over inheritance.

Even if your clients have made a will and discussed their inheritance plans with their beneficiaries, putting the ins and outs of their decisions in writing is a belt and braces approach that, in today’s economic climate, could be worth taking.

A letter of wishes may contain:

• Sections addressed to each beneficiary with additional explanations, instructions, and sentiments
• Instructions for who will pay for a funeral service, and how this should be conducted
• Details of how to access and handle certain assets.

With all bases covered, your clients could rest assured that the chance of a costly and upsetting dispute is minimised.

Get in touch

Our financial planners can help your clients put together an estate plan that takes their family’s wishes into account. Email enquiries@prosserknowles.co.uk or call 01905 619 100.

Please note

This article is no substitute for financial advice and should not be treated as such. To determine the best course of action for your individual circumstances, please contact us.

All information is correct at the time of writing and is subject to change in the future.

The Financial Conduct Authority does not regulate tax planning.