Families are becoming more open about their finances as the coronavirus crisis highlights the need to discuss wills and inheritance, new research1 from Handelsbanken Wealth Management shows.
Its study at the height of the pandemic shows it has already prompted a third (33%) of people in the UK into either drafting a new will or amending their existing one.
And the research suggests that the crisis is having a wider effect by making families more open with their finances. Nearly four out of five (78%) believe the pandemic will lead to more conversations about inheritance planning within their families.
Not everyone is changing – more than a fifth (22%) of people say they do not have a will, and do not plan to draw one up. Around one in 10 say they believe doing so would be tempting fate.
Families can face major problems if there is not a will in place, particularly as complex family setups are increasingly becoming the new normal. Nearly one in seven (13%) families in the UK now have a stepson, stepdaughter and/or adopted son or daughter as part of their family unit. And a fifth (21%) of parents have been involved in two or more romantic relationships that have led to them being legally responsible for children who are not directly theirs.
An outdated will can be challenged, which would be a drain on a family’s estate. This is especially pertinent as only 27% of adults are confident that their current wills are unlikely to offend relatives. Nearly half (49%) of those with a will have never rewritten or amended them. Just 24%2 have amended their will once, 16% have amended it twice, and only 5% percent have amended it three times.
There are signs that most adults grasp the significance of sorting out wills – around 81% believe coronavirus will convince people to sort out their financial affairs and 83% say it will trigger people into drawing up new wills.
As many as one in 10 believe that Covid-19 will mean the inheritance they are able to leave to their family will be smaller than originally planned.
Alex Spreckley, Head of Wealth Management at Handelsbanken Wealth Management says: “Coronavirus is having a devastating impact on the UK and the world not only in terms of lives lost, but also in terms of the livelihoods and finances of countless families, which have been gravely impacted.
“It is now more important than ever to ensure that families are getting their financial affairs in order. Speaking to a financial planner ensures that all bases are covered and family members are looked after. Having a watertight, up to date will in place can bring peace of mind to you and your family.
“There are a number of life triggers that should be at the front of everyone’s mind when it comes to writing or amending a will. These include a death in the family, marriage, new members – be they step or adopted children – or significant losses or purchases such as a new house, to name a few.”