Don’t let your will become a blank cheque
Everyone should have a will, but Harry Brennan finds that some providers want to take their own cut from clients’ estates
Consumers are at risk of being caught out by firms that offer willwriting services, often for free, but name themselves as executors and take a cut of their estate. An alarming 6 in 10 people do not have a valid will in place, according to consumer champion Which?, with 20pc of people saying writing a will had never occurred to them.
Charities have aimed to change this with campaigns like “free wills month”, an initiative that encourages institutions to provide will-writing services free of charge.
However, experts have warned consumers can unwittingly be at risk of giving away a significant proportion of their wealth by appointing a lawyer, bank or building society as the administrator.
They have also warned that new transparency rules, which will be brought in this December by the Solicitors Regulation Authority and require firms to make probate and estate administration fees clearer, only apply when the administration of the estate begins, not when customers sign up.
This means many could be unknowingly giving away vast sums of cash, while friends or family could have been appointed to do the same job free of charge.
Peter Robinson, 72, a retired business consultant from Sheffield, instructed local solicitor Buchanan & Co to write up his will and to name a close family friend as the executor of his estate, which Mr Robinson estimates will be worth around £500,000 when he dies.
When it came to checking over the terms and conditions, however, Mr Robinson was surprised to see the solicitor had included itself as coexecutor.
Mr Robinson then questioned the firm on what the fees for its services would be, as there was no indication made in the draft will. In response the firm said that it could not put an exact figure on its services, but that it could charge five to 10pc of the overall estate, or £25,000 to £50,000 respectively.
When he questioned the firm further, it said the fee could be as low as 2.5pc of the estate, plus VAT and other expenses – still more than £12,500.
“Essentially, it wrote itself a blank cheque,” he said. “I’d rather put the lot on the 5.30 at Kempton than hand over my money to them.”
Mr Robinson said he asked the firm to redraft the will and that he was shocked to learn this would cost him £45. He gave up with the local firm and found services elsewhere.
Gavin Holt, of law firm Co-op Legal Services, said professional executor appointments are not a universally bad thing, but that in certain circumstances consumers could be open to abuse in the event an unscrupulous firm named itself in the will without the client’s knowledge.
Lorraine Robinson, of Farewill, a will writer, said the practice used to be more common, and high street banks were once among the worst culprits, sometimes offering wills for free but making it conditional that the bank was named as the executor, and taking a percentage cut of the estate.
“I spent 10 years working at a law firm that worked with banks offering wills and executor services, she said. “Unfortunately, transparency wasn’t great then and many people were unaware of what it was they were signing up for, meaning there will be people out there now who still have a professional named as their administrator.”
If the estate is simple, a professional executor may not be necessary. Ms Robinson advised people to keep their wills up-to-date and to question whether or not it was appropriate to have a professional sorting it out. If it is not, she said, you can simply rewrite the will.
“This is something that unfortunately still goes on and there are providers who are not following good industry practice. It should never be a condition of having a will drawn up that the writer is also the executor,” she added.
Mr Holt said there were cases when a professional executor could be valuable. For example, if someone lived alone and had little or no family or friends, and no one was willing to be an executor. Or if an estate is likely to be fairly complex, or where there is a chance the will may be contested and a client wants everything to be legally watertight.
Sometimes, he added, estranged families can make the probate process incredibly unpleasant and having a professional taking care of things can help.
Buchanan & Co said it could not comment on individual customer matters due to “client confidentiality”. “As a client’s circumstances sometimes change between making the will and their eventual death, we are unable to provide quotations for our probate charges at the time the will is made,” it added.
‘I’d rather put all my money on the 5.30 at Kempton than hand it over to that firm’
Peter Robinson hired a firm to draw up his will; it named itself as coexecutor