7 mistakes entrepreneurs make when creating a Will

When you are busy running your own business, estate planning is often the last thing on your mind.

With the pressure of work and your to-do list growing, it’s understandable why you want the will-writing process to be over and done with as quickly as possible.

However, when you’re in a rush or you’re not sure where to begin or the exact rules to follow, you risk making mistakes. Mistakes that could cost you and your family’s future.

As an entrepreneur, your will is one of the most important documents of your business. It’s the piece of paper with the power to determine the future of your legacy if the unexpected were to happen.

The stakes are high. Making sure your will is error-free ensures the business and wealth you’ve worked so hard to build is passed to the right people. Sure, writing a will is straightforward if you have a small estate, but gets complicated when you build a successful business and accumulate wealth.

Here’s a list of the 7 simple mistakes to avoid so you have peace of mind your wishes are carried out when you’re gone:

Mistake #1 – Leaving out certain assets

The reason you have a will in the first place is to ensure you have control over how your assets are divided up after death. If you forget to include specific assets, no matter how minor they may seem, or if you die without a will in place, your estate instantly becomes subject to the state rules. This means your assets are split up in line with the intestacy law, regardless of your wishes were before your death.

Mistake #2 – Forgetting to update any changes

Perhaps you got a will written up a few years ago and it’s been a while since you’ve had another look at it. And by a while we mean enough time has passed by for your circumstances to change – like getting married, divorced or having a child.

All of these situations call for you to review your will and make the necessary updates. Make it a habit to look over your will every so often to avoid creating an estate nightmare for your loved ones if you were to die unexpectedly.

This is also a reminder to keep your will in an easily accessible and safe place, i.e., not your sock draw.

Mistake #3 – Not seeking legal advice

When it comes to seeking legal advice, this is the one situation where you can’t go wrong. We appreciate why many take a DIY approach or use a value option, however, this is the one aspect we don’t recommend trying to do yourself or on the cheap.

The worst-case scenario is a will being declared invalid. There are a strict set of guidelines to avoid this happening. If you’re unsure, seek legal advice from an expert who can point you in the right direction, especially if your estate is worth more than £325,000 and potentially subject to inheritance tax.

Mistake #4 – Being too specific

This is when it can get confusing. Isn’t the whole point of a will to pass down specific assets? Yes, it is but if you’re too focused on the specific details, your will may be outdated by the time of your death.

For example, if you wish to leave your car to your eldest child, instead of using the specific model of car, stick with a more general description of the asset, such as ‘the car in my name.’ If you end up upgrading your car over the years and forget to update your will, the executor can dispute the claim.

This is also why it’s vital to make sure you to make changes to your will each time something changes, either in your business or personal life.

Mistake #5 – Being too vague

Although you don’t want to be in a situation where your will is rendered invalid due to being too specific, you also don’t want there to be confusion over your wishes.

For example, be specific about who you want as the executor of your estate. This is the person who will be responsible for settling your assets and should be someone you trust. Steer clear of ambiguous language or terminology. This is not the time to leave matters up to interpretation. Be specific to avoid the court stepping in and deciding on your behalf.

Mistake #6 – Failing to provide a reason for leaving out a dependent

This is where it gets really tricky. If you plan to leave a dependent out of your will, you need to explain exactly why you’ve made this decision and where your estate will go instead. Failing to do so could result in the person challenging your decision.

If you choose to leave your estate to an animal charity, an estranged family member or business partner, your loved ones could contest your decision and take it court. There have been many high-profile cases where people have successfully won a case on the basis of them been unreasonably excluded from a will.

Mistake #7 – Forgetting to factor in debts

Assuming your debts die with you is a one-way ticket to causing a legal nightmare for your heirs.

Yes, your debts don’t become someone else’s responsibility after your death, but they are recoverable from the estate you leave behind. Your estate will not be split up between beneficiaries until every debt you owe is settled. Ensure every gift you pass on doesn’t come with a serious financial complication attached to it.

Perhaps the biggest mistake of them all is not writing a will in the first place. For the business owner, now is the best time to get this done.

Discover how to avoid all the mistakes listed here by downloading our business owners guide to wills and make sure your wishes are followed when you pass away. Download the guide here [LINK].

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