What is the difference between making a Will and estate planning?

There is a common misconception that estate planning and Will writing are the same. This is incorrect – Will writing is an important part of planning someone's estate and dictates the beneficiaries of an estate, but the planning process goes a lot further than this. Estate planning goes much further in terms of clarifying a person's wishes regarding their finances, planning for care costs, and more. This guide will cover some of the differences between Will writing and estate planning and the importance of the two so that you can make the right decisions for you or your loved one's future.

For more details on how our Wills and estate planning solicitors can help you prepare for the future, call us on 01555 662576, or request a callback by completing an online enquiry form.

Will writing and estate planning

Will writing is a straightforward process in which you outline in writing who will inherit your finances and estate when you die. If your assets are not considered complicated, making a Will document should be simple. In your Will, you can state, for example, who will inherit your property, take care of children, and receive any money from your Estate. You can also name the executors of your Will, who will be responsible for the distribution of your Estate.

Estate planning is more complex than Will writing and includes several documents covering your family and property if you should pass away. Estate planning involves several aspects, such as the making of a Will and establishing Powers of Attorney.

Establishing a Power of Attorney

A Power of Attorney permits another person the power to make certain decisions on the Will-holder's behalf should they lose the mental capacity to make their own decisions. There are three main types of Power of Attorney, including:

Welfare Power of Attorney

This type of Power of Attorney is only used if the will-holder can no longer make their own decisions or lacks the mental capacity to be aware of their own choices. The person appointed as the attorney can make decisions regarding medical care and care home decisions on behalf of the individual.

Continuing Power of Attorney

This enables the person appointed as their attorney to make decisions on another person's behalf in relation to their property assets and finances.

Combined Continuing and Welfare Power of Attorney

This enables the person appointed as the attorney to make decisions based on both the financial and health-related care of the will-holder.

What should be included in a Will?

The most important part of estate planning is ensuring that a valid Will is in place for the deceased. The Will should cover how the estate will be divided, name beneficiaries, appoint guardians for Trusts (if applicable) and executors of the Will. The various assets included in the Estate should be outlined, and the Will should be correctly drafted, and signatures witnessed. In Scotland, a Will must have one witness, who is also ideally not a beneficiary. 

I have a Will – is estate planning still important?

It is a misconception that only wealthy individuals need some form of estate planning. Even if you have a Will, estate planning is still important in order to ensure that your Will is upheld and your assets are divided in the way you want them to be upon your death. Many people decide to disregard estate planning because they do not consider themselves wealthy enough, but in reality, we all have an estate of some kind. By planning your estate with a solicitor, you can ensure that your Will is followed correctly, establish any trust funds and their administrations for future generations, explore inheritance and capital gains tax mitigation, and set up Powers of Attorney.

Larger estates and tax planning

If you have a large estate, you need to be extra vigilant to ensure that your assets are distributed in accordance with your wishes so that your wealth is handed down to future generations in your family, or given to others as you request. Simply giving assets to the next generation comes with several tax considerations, and it is important to speak to a solicitor who can provide you with pragmatic solutions.

Contact our Wills and Estates Solicitors Lanark, Hamilton, Motherwell & Wishaw, Scotland

At Davidson & Shirley Solicitors, our experienced team can help you draft a Will and advise on the technicalities of estate planning, ensuring that your estate is distributed exactly how you want it to should you pass away. Contact us today at our Lanark office on 01555 662576 to speak to us, or fill in our online enquiry form, and we will get back to you.