Quickie Divorces Present New Fear For Grandparents When Writing Wills
Two thirds of over 60’s admit they have nothing in their will to protect their assets if their children get divorced.
According to new research, 67 per cent of the nation’s older generation of parents will leave at least £100,000 in their will.
But with quickie divorces on the rise, their hard earned money and assets could be lost to their children’s ex-partners, or potentially fail to reach their grandchildren.
With a quarter of those surveyed saying they would like their life savings spent on their grandchildren’s education, it’s no surprise 20 per cent fear their children’s relationships failing.
This research comes off the back of online divorces becoming available in the UK from April last year. The service has already received 23,000 applications with 455 couples filing to end their marriages between Christmas Eve and New Year’s Eve, last year.
The simple online process often fails to provide adequate protection for dividing assets, putting the future of money gifted in wills at greater risk. But even without this easy process the Office for National Statistics reports 42 per cent of marriages in England and Wales end in divorce.
One in five of those surveyed said they were worried about how their money would be divided should their child divorce from their partner and 23 per cent said divorce rates changed how they planned to offer inheritance.
Without the threat of divorce 15 per cent still said they did not trust their child’s partner with money, with two in five of these people considering cutting the couple out of their will because of it.
But despite these concerns, two thirds also admitted they had not even considered adding any kind of guidance within their will to specify how money and assets would be spent.
With so many worries about how assets would be spent and divided, some over 60s have adopted the practice of SKiINg, or Spending the Kids’ Inheritance. For 15 per cent of respondents they felt eliminating inheritance all together was the easiest way to avoid family feuds.
The research polled 1000 over 60s and was commissioned by wills, trusts and probate experts at Slater and Gordon, after being asked by clients what to do should their children’s marriages fail.
Precious Igbokwe, from Slater and Gordon, said: “The unexpected break down in relationships, especially when children and grandchildren are involved, is another element that should be considered when writing your will and more importantly, keeping it up to date.
“Many people have an idea of how they would like the money to be spent, especially as we are discussing vast sums of money that many have worked their whole lives to achieve. Some choose to skip a generation and leave it all to the grandchildren or add stipulations on how it is spent. This could include asking for a percentage to be spent on the grandchildren’s education.
“But sadly many people also do not consider this, which can lead to their wishes not being followed and family feuds taking place.”
When asked what they wanted their children to do with the money, 38 per cent wanted the money saved, 33 per cent wanted their children to settle their debts, while 27 per cent wanted their kids to indulge in the money and have fun.
One in seven admitted they are worried about how the money they leave will be spent, of which nearly half said thei biggest concern was how their kids would choose to spend it.
Divorce rates were not the only factor influencing how people thought about their wills. A third also expected they would have more money to pass onto their children thanks to rising house prices.
Precious Igbokwe said: “Talking about wills and death is never nice, but it’s important. If people know their wishes will be respected once they are gone it can take at least one worry off their plate.
“We are talking about people’s life savings and often equity in property that can amount to hundreds of thousands of pounds. This can be life changing sums of money for people. If the parents aren’t satisfied their children will take the right steps to keep it secure they are advised to seek advice.
“However, this research shows us despite many people having concerns, two thirds have not even considered measures they could take to protect their assets.”
Nearly a quarter said they felt pressure to treat children fairly, despite having concerns about what would happen to their money. Over a third also said they suspected it was possible or likely their children would fall out following an unequal split. As a result 33 per cent have dodged disagreement completely by avoiding discussing their wills with children.
There are other ways to secure inheritance, but the research also shows few people considered these options. Three in five had no understanding of creating trusts to secure assets and 76 per cent had not considered possible arrangements to pass on assets without these being reduced by inheritance tax.