[lead]A letter of wishes is a document drawn up to accompany your Will. It offers guidance to your Executors about how you would like them to deal with your assets and ways you wish for them to exercise their powers. Whilst your Executors are not legally bound to follow your Letter of Wishes, in practice it is usually followed.[/lead]
Benefits of writing a Letter of Wishes
A big attraction of a Letter of Wishes is that it can be informal, and it can be changed at any time. This flexibility eliminates the cost and formality of amending your Will. Letters of Wishes should be updated when circumstances change and reviewed on a regular basis.
Additionally, a Letter of Wishes can usually be kept confidential from the beneficiaries of your Will. A Will becomes a public document after death if a Grant of Probate is obtained, whereas a Letter of Wishes does not. They therefore offer an opportunity to provide more private or sensitive information to guide your Executors.
Why would I write a Letter of Wishes?
1. Excluding someone out of your Will
There are sometimes situations where you may want to exclude someone from benefitting in your Will, such as an estranged child or grandchild. Certain qualifying individuals can bring a claim against your Estate under The Inheritance (Provision for Family and Dependants) Act 1975 on the basis that there is an expectation that you would make provision for them in your Will. There is no definitive way of preventing a claim against your Estate, even with a Will in place. In this circumstance, writing a Letter of Wishes is crucial for explaining the reasons why you have chosen to exclude that individual from your Will. Whilst the Letter of Wishes cannot prevent a claim, it can be produced as evidence of your intentions and used to support your Executors should a claim arise.
2. Discretionary Trust
A Discretionary Trust is a form of trust which can be set up by an individual in which two or more trustees manage the assets held in a trust for the potential beneficiaries. An individual can either create a Discretionary Trust in their lifetime, or in their Will which then takes effect after you have passed away. The Discretionary Trust format provides a great deal of flexibility, as your trustees can act as they think most appropriate. Whilst you cannot tell the trustees what decisions you wish them to make, you can outline your thoughts and wishes as to how you would like them to operate the assets of the trust in a Letter of Wishes.
3. Guardian Guidance
When making a Will, it is common to appoint a Legal Guardian for your children if they are under the age of 18. Writing a Letter of Wishes to sit alongside your Will can provide guidance for your nominated Guardian as to how you would want your children to be raised, for example regarding living situations and education. Whilst the Letter of Wishes is not binding, it is the best way to make your wishes known to your nominated Guardian.
4. Distribution of Personal Belongings
It is possible to include a clause in your Will that asks your Executors to distribute your personal possessions in accordance with any letter found with your Will. This is a flexible way of dealing with your belongings, as it can easily be amended to reflect changes in your personal possessions or if you change your mind as to the beneficiary. You may simply update your Letter of Wishes without the need to make a new Will.
5. Personal statements of Affection
You may wish to use a Letter of Wishes to write a letter to your loved ones, to say goodbye and to pass on your final thoughts. This is something your family could treasure and form a valuable part of the legacy you leave behind.
It is crucial that the Letter of Wishes is written in a certain way to ensure that you have covered all potential elements of a claim and that your wishes present a reasoned argument that would read well before a Judge. The best way to ensure this is to seek advice from your Solicitor writing your Will. If you would like to discuss your Will, please contact our team of specialist Solicitors today on 01244 312 306.
