Write or update your will

Whether you are worth millions or hundreds, it makes sense to have a will so that your estate (what you leave when you die) can be processed efficiently, your spouse and any dependants can be protected and your possessions can be disposed of according to your wishes.

If you die without a will in England and Wales, the rather antiquated intestacy rules do not recognise unmarried partners or step-children. It can take many months before those left behind are able to gain access to bank accounts, savings and even life insurance. If you are married, the situation is not much better. Your husband or wife gets your personal possessions and a fixed amount of money. This can create havoc if the value of the home you share is more than the £125,000 limit set by the government. With the average UK house currently worth more than £218,112, your spouse would have to find the cash to make up the difference or face losing their home. If you are a single parent without a will the state will decide who will have parental responsibility for the children, including the possibility of making them a ward of court.

A simple will can be drawn up by a solicitor for between £60 and £100. It can be changed and superseded throughout your lifetime. Any existing will is automatically revoked upon marriage. Equally, if you divorce, your former spouse will be removed from your will because the law supposes that you would not want them to inherit your estate. From 9 Oct 2007 you can leave up to £312,000 tax-free to anyone in your will, not just your spouse. Inheritance Tax is then payable at 40% on any amount you leave above this.