What's The Cost?
Let's address those pricing questions that are not being spoken about often by our competitors.
How Much Does It Cost for You To Have A Private Wealth Plan?
A Private Wealth Plan is a full Estate Planning/ Generational Wealth Solution for individuals who want to provide robust and flexible planning for the loved ones and family members. Please feel free to grab our latest Recommended Price List
There are many factors that can affect the price of Private Wealth and we shall explain what those factors are.
What Type of Private Wealth Plan Do I Need?
We encourage all of our clients at the bare minimum to have a suitable Will in place and a Registered LPA (Lasting Power of Attorney) If a lack of mental capacity were to occur temporaily or permanently. The type of Will required is based on your family circumstances, your goals and individual views.
Factors That Influence Pricing
We believe that prevention is better than cure. Trying to solve a problem retrospectively is very expensive. Based on this philosophy of Private Wealth Planning, the more factors considered to protect your family in the future and cover the majority of situations and circumstances (Robustness & Certainty verses Certainty & Failed Planning) this will affect the potential costs involved.
Ways to save
We do reward our clients if they decide to get all of their planning carried out all at once. If it's a sizable project, then it's better to work in stages. We then organise a phased payment solution.
Case Study #1 – What's The Cost?
Sandra Ashby (this is not the real name of the client) required advice regarding a potential Inheritance Tax (IHT) liability as she had recently sold her main home and moved in with her son via a ‘granny annex' which she had self funded. Sandra also made significant gifts to her two children in excess of £300,000 in the last 3 years and Sandra is in her early 80's. We charged Sandra £500 for an extensive IHT review outlining current position and recommended options to reduce the liability asap within 7 years or sooner.
Sandra had an estate of circa £900,000. This included the £300,000 gifts made to her children; £250,000 cost to build the annex in her Son's home, and the rest was made up in savings and investments. Within a further 4 years, Sandra's estate would reduce to £600,000 and if she starts to pay market rent, the 7 year clock would start for the £250,000 gift to build an Annex. Under the complex Residence Nil Rate Allowance rules, Sandra was still eligible to claim the full £500,000 IHT Allowance.
Sandra updated her Will to gift any inheritance via a trust and preserve the additional £175,000 IHT allowance within 2 years of a death event. Based on the advice given, and immediate action taken, Sandra will save a total of £160,000 and pay zero inheritance tax after 7 years or £60,000 within four years.
Total Amount invested for the advice and solution: £1280 or 0.14% of Estate value. (potentially savings £158,720!)
Case Study #2 – What's The Cost?
Judith was very concerned about future income as her partner, Jordan (both fictional names to preserve privacy), was recently diagnosed with a rare form of dementia at just age 35 (Frontotemporal Dementia). Their combined estate was worth £1.9M. Judith's concern was providing suitable care for her partner and raising their two young children aged 3 and 1.
This was a complex case on many levels. The initial advice was for the couple to get legally married. The life insurance policies were not in trust, and Lasting Powers of Attorney were thankfully already in place.
As Jordan still had testamentary capacity at the time, emergency Wills and Life insurance Trusts were recommended and produced within 7 days. Placing the policies into trust would reduce the combined Estate by £1.5M. Getting legally married would allow a combined inheritance tax allowance of £1M.
The trusts for Jordan were drafted with Section 89 provisions (vulnerable persons) so the inheritance tax would be calculated on the basis of an individual rather than a the basis of a relevant property trust during lifetime. An unlimited amount could be paid into trust free of inheritance tax and protected under discretionary provisions if the life company paid out out during his lifetime.
As they would be legally married, we can utilise the married/spousal privileges to focus on IHT planning on the second death if required as Judith is only in her 30's.
If the life insurance paid out on a death event, the funds would still be available almost immediately for Judith and the children's benefit. The trusts where drafted with special consideration for Inheritance tax on death, so not to attract a 20% immediate inheritance tax (IHT) charge, saving £100,000 potential IHT.
Combined Estate Size: £1.9M , Total Inheritance Tax Saved (for Jordan and family) £120,000. Total financial commitment/ investment: £6000 or 0.32% of total estate value.
Case Study #3 – What's The Cost?
Adrian and Susan Richard (not original names to protect identity) own a £1.2M property. They are married with three young children under 18. Only Adrian is named on the property.
Adrian also has other assets, total combined estate is £1.68M. Adrian believed that if he passed away, everything would pass to his wife and Children.
As neither Adrian or Susan had a Will in place, the reality is that if Adrian passed away, only the first £270,000 would pass to his wife and the rest of the house would split 50:50 between the children. Plus Susan would have to wait until the Children were all over 18 to see if they would give her back the property or not.
If Susan ever needed to Sell or got remarried or even needed care, it would be very messy to deal with the estate and there would be no guarantee on how she would be provided for. If Adrian were to pass away while the children were minors, any post death planning would also be quite difficult as under the age of 18, they would be treated as minors an unable to make decisions legally.
We recommended to Adrian that Susan should be added to the property officially and given a 50% share as tenant in common. We would also draft flexible mirror Wills so the correct Inheritance Tax planning could now be in place and both Adrian and Susan's expectations would be met if either were to die, i.e. that the share of the deceased would be given to the spouse for her enjoyment only and then passed to the children equally.
Adrian and Susan also wanted to put an Asset Protection Trust in place as they have over £1m of equity in the property, both in thier 40's and wanted to protect it for the benefit of each other and the children (Asset Protection & Bloodline planning).
Total Investment: £7600 for complete peace of mind, Asset Protection, Bloodline planning and Inheritance Tax planning to utilise the full £1M allowance.