Inheritance Financial Advice

Inheritance Planning Advice

Whether an inheritance is a surprise windfall or an expected endowment, it is never something that should be squandered. Our advisers are the leading inheritance advice specialists around the UK so make top quality inheritance financial advice a priority and call The Financial Advice Experts to find out more about what to do with inheritance money.

What Happens When You Inherit Money?

It may take some time after a person dies for their estate to be finalised, especially if assets need to be sold so that money can be divided. Unless the will states the money is to be held in trust (as is often the case for minors who inherit), money you receive is paid directly into your bank account, or assets such as a house transferred into your ownership. As tempting as it may be to spend the money immediately, it is important to get good financial inheritance advice before doing anything.

What you do with your inheritance money is up to you, but it is wise to consider the ways its use can benefit you. For example, if you have significant debts, using part or all of your inheritance to pay them off can be more financially beneficial than if you put the money into savings as the amount of interest you avoid paying on your debt is more than the amount you would earn if you were to invest it.

If you do not need the money now, you may consider investing as part of your retirement financial planning. Talking to an advisor will help you determine the type of investment that best suits your circumstances whether that is property, pension, or another type of investment.

Inheritance Tax

Inheritance Tax in England and Wales is incredibly complicated, and it pays to have specialist financial advice. The amount you inherit and your relationship with the deceased can affect the amount of tax you pay. The UK Inheritance Tax (IHT) threshold is £325,000 with amounts over that being taxed at 40%. Tax is calculated on the value of the estate and not the value of the endowment. For example, a parent with a house worth £650,000 could not avoid IHT by stating their home should be sold and their two children be given £325,000 each.

In addition to advising beneficiaries, our inheritance financial advisors work with executors who are charged with the responsibility of ensuring IHT is paid correctly, as well as with executors who are writing their will and want to ensure their assets are managed in the most financially effective way to benefit those they leave behind.

There are steps that can be taken to reduce the amount of IHT your estate is liable to pay. One of these is by giving away a lump sum of up to £3,000 in a tax year, as well as an unlimited number of gifts of up to £250 during the same period. You can also give up to £5,000 as a wedding gift to your child, or £2,500 to your grandchild without them being considered for IHT. Financial gifts made in addition to these may incur inheritance tax if they total at least £325,000 and you do not survive for at least seven years after you give the money or assets.

Specialist financial advisors like those we work with can help you manage your inheritance money wisely. Contact us today to arrange an initial consultation to find out more about how you can make the most of your inheritance.

Specialist financial advisors like those we work with can help you manage your inheritance money wisely. Contact us today to arrange an initial consultation to find out more about how you can make the most of your inheritance.