Cash clinic: Making a will is only first step to a secure future for children

Q: My husband and I are thinking of having a family and I have started worrying about what would happen to me if he died. I will be very dependent on him financially if we have a baby as I intend to stop working. He has not made a will so we don't currently have anything in place to organise the finances should anything happen to him.AO, Perth

A: As a general rule, you should both make wills and review them at least every three years. If you do not make a will any property you leave (known as your estate) might not go to the people to whom you would want it to go.

It is also important to recognise that wills are only one part of a succession planning exercise. Inheritance tax (IHT) is currently charged at a rate of 40 per cent on estates over the value of the nil rate band, which is currently 325,000. Up to 100 per cent of the unused proportion of the nil rate band of whichever spouse dies first can be claimed on the surviving spouse's death, provided the estate is left to the surviving spouse.

Please bear in mind that any gifts made in the seven years prior to death would be taken into account. There would therefore be IHT at 40 per cent over this amount. This is very different from the IHT position if you were not married and were just living together and there are several IHT and financial planning mitigation measures which could be taken.

You do not say whether either of you are or were previously married, or have children already but this would also be important. Under Scots Law, if an individual dies and does not leave a validly executed will their estate is distributed according to the rules of intestate succession. Your surviving spouse is entitled to claim "prior rights" and these are significant. "Legal rights" can also be claimed by your spouse and children in your estate.

It is essential that you seek specialist legal and financial advice on these matters.

• Glen Gilson is a partner and head of private client and financial services at HBJ Gateley Wareing.

• If you have a question you need answered, write to Jeff Salway, Personal Finance Editor, The Scotsman, 108 Holyrood Road, Edinburgh EH8 8AS or e-mail: [email protected]. The above is for general purposes only and is not tailored for individual use. It does not constitute legal, financial or investment advice on any particular matter and must not be treated as a substitute for specific advice. No action should be taken in reliance of the information given. The Scotsman Publications Ltd and HBJ Gateley Wareing accept no liability on the basis of this article.