Wealth Management Update October 2024

Pick the Right Executor to Prevent Disputes

Choosing an executor for your Will is a bigger decision than you might think, and recent stats back this up. Court disputes over how Estates are managed have shot up by 20% in the past year, meaning more people are finding themselves tangled in Legal battles over how their loved one’s wishes are carried out. This rise in disputes really drives home the importance of picking the right person for the job.

So, what exactly does an executor do, and why does it matter so much? An executor is the person named in a Will to manage the deceased person’s Estate. This involves everything from paying off debts to making sure assets are distributed according to the Will. It sounds simple, but it’s a role with serious responsibilities. If mistakes are made, or if the executor doesn’t act in the best interests of all beneficiaries, they could end up facing a lawsuit.

The most common issues come up when executors breach their “fiduciary duty”—which is a fancy way of saying they didn’t do what’s best for everyone involved. This could happen if they distribute assets in a way that doesn’t align with the Will’s instructions, or if they favour some beneficiaries over others. When these things go wrong, it can lead to stressful, costly court battles that can strain family relationships.

Many people naturally choose a close family member, like a spouse, partner, or child, to be their executor. That makes sense—they’re the ones who care the most about carrying out your wishes. But given the increase in disputes, it’s important to make sure the person you choose is not only trustworthy but also capable of handling the responsibilities.

If you’re concerned about overwhelming a loved one with the complexities of the role, a smart move is to name them as executors but give them the freedom to hire a professional to help with the more complicated aspects. This approach gives you the best of both worlds—someone you trust is in charge, but they can lean on professional expertise when needed.

Get in touch today on 02920 450 143 or email us on [email protected] and we can get you referred to our Legal Advisers over at Simpson Solicitors, who can help guide you in choosing an executor who will honour your wishes and manage your Estate smoothly, ensuring peace of mind for everyone involved.

Don’t Overlook Pensions During Divorce

Pensions are one of the most valuable assets a person can have, but they are often overlooked during divorce proceedings. There are several reasons why this happens, and unfortunately, this oversight can lead to financial difficulties later on.

One of the main reasons Pensions are missed is their complexity. Understanding how different Pension schemes work, such as defined benefit or defined contribution plans, can be confusing. This complexity leads many people to focus on more straightforward assets, like the family home or savings accounts, and push Pensions to the back burner.

The emotional stress of divorce also plays a big role. When dealing with the immediate challenges of separation, people tend to focus on the short term—what’s happening now—rather than the long-term financial consequences. As a result, thinking about retirement might not feel like a priority at the time.
Another common issue is that people often assume Pensions belong solely to the person whose name is on the account. However, under UK law, Pensions accumulated during marriage are considered joint assets and can be divided between spouses.

Additionally, many people simply don’t realise that Pensions can be shared during a divorce. This is especially true for those who may not have been involved in retirement planning or who haven’t paid attention to their partner’s Pension details.

Divorcing without considering Pensions can lead to Financial insecurity in Retirement, and it’s crucial to get professional advice to ensure that all aspects of your Financial future are taken into account, including Pensions. Download our Pensions and Divorce Guide here to read how you can prevent losing out on what could be a significant portion of your assets.

What Are the Trustee Bank Accounts and How Do You Get One?

If you’re setting up a Trust or managing money on behalf of someone else, a Trustee bank account is a great way to keep things clear and organised. These accounts are designed specifically to hold and manage funds for other people, like a child, a charity, or someone who can’t handle their finances.

The main benefit of a Trustee account is that it keeps the money completely separate from your own. So, if you’re a Trustee (or will be one), it ensures you’re managing the funds responsibly and following Legal guidelines. This kind of account is ideal for situations like managing a family Trust, handling an Estate, or safeguarding funds for vulnerable people.

Trustee bank accounts are all about transparency and accountability. As a Trustee, you’re responsible for making sure the money is used for the benefit of whoever the Trust is for, and these accounts make it easy to track all transactions and keep things clean and above board.

One good option is Metro Bank, which offers a dedicated Trustee Banking service. They make it simple to manage funds with online banking, dedicated support, and easy access to account information. It’s a solid option for anyone acting as a Trustee, giving you the tools to manage funds responsibly and with peace of mind.

While most banks do not want to offer these Trustee accounts anymore, Metro Bank is still currently offering solutions. If you’re unsure whether a Trustee account is right for you, your Financial Planner can guide you through the process and help set up the best option to meet your needs. Contact us on 029 2045 143 or email us on i[email protected] to find out how we can help you set up a Trustee bank account.

Interest Rates Are On the Way Down, Just Not Yet

There’s some good news —interest rates are slowly heading down! The Bank of England has kept rates at 5%, and their governor, Andrew Bailey, thinks we’ll see more drops soon. Inflation is coming down too, but the Bank wants to be sure it stays low before making any big rate cuts.

So, what does all this mean for you? If you’ve got a mortgage or any kind of loan, you’ve probably noticed that borrowing money is more expensive lately. But if you’re saving for the future, the higher interest rates have meant better returns on your savings.

Experts think we could see rates come down again in November, but Bailey warns they need to be careful not to drop them too fast. It’s all about keeping inflation in check and making sure the economy stays stable.

For homeowners, higher mortgage rates might have meant paying more each month—or landlords upping the rent to cover costs. On the flip side, if you’ve been tucking money away, you’ve likely seen your savings grow a bit faster.

While inflation from the pandemic and the Ukraine war seems to be easing, the UK economy is still recovering slowly. High prices have consumers pulling back on spending, and growth is expected to remain sluggish for now.