Wills - Case-Studies

Second Marriage Life Interest Wills – Case Study

This case study relates to David and Shelia who had been married 10 years. Both David and Shelia had been married before. David was divorced and Shelia was a widow. They both had adult children from their first marriages. David had a son and Shelia had two daughters.

David and Shelia contacted us about making a will. They stated that they owned their own home in joint names worth £150,000 and they had savings and investments between them totalling £40,000.

They wanted the survivor of the two of them to continue to reside in their home. David was keen to make sure that his son received his 50% share of the home and Sheila wanted to make sure that her two daughters would receive her 50% share.

They understood that as things stood as they were, that when one of them died that the surviving spouse would inherit everything and that when the second spouse died there was no certainty that David and Sheila’s children would receive their shares equally. In fact, there was a very real risk that one or more of the children could lose out on their inheritance.

After discussing matters fully with ourselves, David and Sheila decided to make Wills creating a life interest in their property in favour of each other and when the life interest came to an end that their respective shares would pass to their children. They wanted to leave their share of the savings directly to each other.

This meant that if say David died first then the life interest created by David in his Will would enable Sheila to continue to live in their home for the rest of her life and then when Shelia died then David’s 50% share in the property would pass to his son and Shelia’s 50% share would pass to her two daughters. If David died first his share of the savings would pass to Sheila.

We then drafted wills for the both of them with the life interest trusts in them and we also severed the joint tenancy in the property to create instead a tenancy in common. This made sure that the property would not automatically pass to the surviving spouse but instead would pass in accordance with the terms of the life interest trust set up in their respective wills.

Their Wills also had the added benefit that if one of them died and the survivor of them then went into a residential care home then the person who died first that their 50% share would be protected and ring fenced from being claimed by the local authority for care fees.

We explained that the costs of drafting both of their Wills and severing the joint tenancy and competing everything was £400 + vat totalling £480.00

If you feel that you might benefit from making Wills with a life interest trust in them then please call us for a free no obligation chat.