3 ways to make sure your kids get the inheritance they deserve
Many people feel that their retirement is their chance to finally enjoy new found free time and spend the money they've worked hard to earn on travel, home improvement and fun activities. Despite this, one in ten adults believes that in doing this, their parents are actually blowing their inheritance.
1. Gift some of your money to family and friends
If you are either married or in a civil partnership, anything that you leave your partner after your death is already exempt from inheritance tax.
However, for other family members or friends, you can give up to £3,000 per year without inheritance tax. You can also gift children and grandchildren cash when they get married.
Even if you give more money and belongings, they won't be counted as part of your posthumous estate as long as you live for another seven years after gifting it.
2. Leave some money to charity
Inheritance tax is not due on any money that you leave to a charitable cause.
If you choose to donate more than 10 percent of your final estate, the overall tax accountable to your estate will be cut from 40 per cent to 36 per cent.
3. Invest in life insurance
Ensure your family members never have to sell property or assets in order to cover the costs of inheritance tax by taking out a "whole of life" insurance policy.
A policy of this nature will make sure that when you die, the insurance payout from the policy goes towards covering the tax bill. However, any of those gifts from the last seven years would still be accountable to inheritance tax.
The article was provided by the Money Advice Service
Advice is the key
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