5 practical steps ageing parents should take to protect the family legacy

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You may find it hard to watch your parents grow older, and starting a conversation about estate planning with them can be uncomfortable.

While it may need delicate handling, there are significant financial and personal benefits to having this sensitive conversation. Because of the time-sensitivity of estate planning, it’s crucial to raise the conversation as early as possible.

Although it might be an emotional topic to bring up, talking and planning now could save your family a lot of stress in the long run. Read on to understand the key elements of estate planning you should discuss.

1. Start with a will

Asking whether your parents have written a will is a natural way to open a conversation about their legacy. If they haven’t organised a will, and 29.5 million adults in the UK haven’t, this is where they should start.

Writing a will may seem daunting, but it can be relatively straightforward. If your parents are resistant to writing a will, explain that having one can help ensure that their assets are kept in the family and passed to future generations, or distributed to people and causes they care about.

Hopefully, they will already have a will in place. If so, encourage them to review it to make sure it still reflects their wishes. It’s helpful to revisit your will every five years and update it whenever necessary. For example, legislation changes which may require action to remain tax effective, or when a child is born into the family.

2. Consider writing a letter of wishes

A letter of wishes can be written to accompany a will. While it’s not legally binding, it provides a useful guide to executors and trustees to ensure personal wishes are understood and carried out according to your parents’ wishes.

Although the letter can outline and advise on anything, the most common uses of a letter of wishes include:

  • Who to notify of your death.
  • What type of funeral you want, for example, whether you want a burial or cremation, any specific instructions regarding the service, and where you would like to be buried or have your ashes scattered.
  • Guidance to your executors or trustees on how you would like any money managed, or trusts created in your will to be run.
  • Explanations why you have excluded someone from the will. This is particularly important if you think it may be a controversial decision or challenged later.
  • A comprehensive list of your main assets, including details of your bank accounts, life insurance policies, expensive personal possessions, or jewellery. This information will help your executors in the administration of your estate. Be sure to include these items in your will too, as the letter of wishes isn’t legally binding. It’s simply a useful aid to help your executors distribute your estate more easily.

A letter of wishes should be written in plain English, signed, and dated, but not witnessed.

Talk to your family about your wishes so that there are no nasty surprises and you’ve been able to explain your thoughts. Family discussions before, can often save falling out afterwards when you are not there to explain your reasoning.

A detailed letter of wishes might save huge sums of money in legal fees. Having information that makes assets easily traceable is likely to make a significant difference to the time it takes to sort out your affairs.

3. Set up a Power of Attorney

Having a Lasting Power of Attorney (LPA) can give you and your parents peace of mind. An LPA allows you or someone else to take care of financial decisions should your parents become unable to take care of things themselves.

Your parents can select their spouse or partner, a family member, or friend to act as their attorney. They may prefer to choose a professional person with fewer emotional biases, such as a solicitor. It’s also possible to appoint more than one attorney, which would normally be done on a joint and several basis.

There are two main types of LPA:

  1. A Health and Welfare LPA – covers daily routine and medical care decisions
  2. A Property and Financial Affairs LPA – allows your chosen attorney to manage your finances, pay bills and collect benefits on your behalf.

Anyone over 18 can set up an LPA. It can be temporary or last for the rest of your life.

4. Create an “in case of emergency” document

While your parents are getting their financial affairs in order, it’s a good idea to suggest they also set up a list of all their assets and information that might be helpful if they weren’t able to look after their own financial affairs.

Put this document somewhere safe but easy to find. It should help avoid having to dig through old mail, bank statements and tax returns to understand what’s what.


  • Bank account details
  • Investment details
  • Any financial protection policies
  • Where you keep your will and LPA
  • The name of your financial planner, solicitor, and accountant.

Having everything organised will save the family time and hassle at a potentially difficult time.

5. Take action to mitigate Inheritance Tax

Now is also an excellent time to consider whether it might be necessary to take action to mitigate any Inheritance Tax (IHT) liability on your parents’ estate.

IHT is usually charged at 40% of any assets in the estate above the nil-rate band, currently £325,000 per person. As well as this, there is up £175,000 per person, as an additional allowance for passing on the main family home to direct descendants known as the residence nil rate band (RNRB).

If your parents may be liable to IHT, they can consider gifting some of their wealth or set up trusts to ringfence a portion of their assets.

Trusts can be a useful way to distribute wealth to chosen beneficiaries, while still maintaining some control of the assets.

Investments that qualify for business relief (BR) can also be useful for mitigating IHT. Provided the shares in this type of investment have been owned for at least two years, they can be passed on free from IHT.

Investing in BR qualifying investments can be suitable if you:

  • Don’t want to give away large sums of money during your lifetime,
  • Want to give the inheritance you plan to leave behind the chance to grow
  • You want the money you invest to become IHT exempt quickly.

Some people also benefit from using life insurance to cover IHT bills. If this is a suitable option, the sooner this is set up the better, because age and health are primary factors that affect the cost of cover. It’s also important to place life insurance policies in a trust so they don’t form part of the estate and add to the IHT liability.

Read this article for more detail on Inheritance Tax and intergenerational wealth planning, or get in touch and we’ll sit down with you and help you and your parents understand everything you need to know.

Get in touch

If you want to discuss the best way to help your parents protect their interests and the family legacy, please get in touch and we would be happy to have an initial no obligation chat, to help you understand your options. Email clientservice@berryandoak.com or call 01937 223 055.

Please note: The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.