Not talking about inheritance can lead to family disputes

Almost one in five adults (18%) in the UK have been involved in a dispute over inheritance, according to new research. Meanwhile a quarter (24%) believe that future disputes are likely due to a lack of open conversations about inheritance.

The findings from Canada Life's Life100+ programme highlight the importance of making a Will and discussing your intentions with loved ones to help avoid misunderstandings and legal proceedings in the future.

Avoiding the discussion

Why do many people avoid talking about money and inheritance with family members and close friends? In Canada Life's research, the most common reasons given are that people aren't planning to leave an inheritance to a family member or loved one (19%), or the fact that they have not started inheritance planning yet (19%).

Another one in ten (10%) people said they do not talk about finances as a family, rising to one in six (13%) for those aged 55 or over. Meanwhile, 5% said they tried to have a conversation about their inheritance plans, but their relatives or loved ones did not want to discuss it.

Among those expecting to receive an inheritance, the main reason for avoiding such discussions is that this possibility is "too far in the future" (29%). Other respondents said that they "prefer not to think about it" (26%), consider it "their business and no one else's" (21%), or find it simply "too difficult to discuss" (14%).

However, there are signs that younger generations are prepared to be clearer about their wishes, as more than two-fifths (43%) intend to discuss inheritance more openly than their older family members.

When can a Will be challenged?

There was a 34% rise in Will disputes between 2017 and 2022, while Google searches for 'disputing a Will' have increased by 60% in just 12 months, IFA Magazine reported earlier this year.

Craig Ridge, contentious probate lawyer at law firm Higgs LLP, explained that a Will may be contested if there is evidence that the testator lacked mental capacity; if a person was financially dependent on the deceased but not included in the Will; in possible instances of undue influence or coercion affecting the testator's decisions; or when there are suspicions of forgery or fraud.

"It is important to recognise that the right to testamentary freedom is highly valued, so a Will generally cannot be challenged simply because its terms are unfavourable to an individual -- another significant factor must come into play," Ridge said.

Possible reasons for the increase in disputes include people relying more on inheritance to buy a home, and heightened awareness about the possibility of contesting Wills due to celebrity cases and TV shows focusing on inheritance conflicts.

44% have not written a Will

Just under half (49%) of people in the UK have discussed their end-of-life wishes with their loved ones, while more than two in five (44%) have not written a Will, Canada Life found.

When asked why they do not have a Will in place, over a quarter (26%) said they don't have enough assets or wealth to warrant making a Will, and 20% believe they still have plenty of time to make one. Another 15% don't want to pay to write a Will, while 14% believe their loved ones will inherit their assets automatically.

"Passing away without a Will in place can place a significant burden on our loved ones," said Stacey Love, tax and estate planning specialist at Canada Life.

"No matter your age, writing a Will should be a priority, even if you don't think you have any real wealth to pass on. It's also very important to have open, honest conversations with your loved ones about your inheritance plans, so they know what to expect."

Guidance and advice

Love acknowledged that discussing inheritance can be "challenging" for many families and some feel that avoiding it may help maintain harmony in the short term. However, the research shows that avoiding these conversations often leads, or has the potential to lead, to misunderstandings and conflicts within families.

Love added: "Working proactively with a financial advisor can be an essential step, as they can provide valuable guidance and advice in an often-complex situation, to make inheritance planning smoother, more manageable, and easier to communicate to loved ones."