The surprising benefits of choosing a “living legacy” for your loved one

Leaving a living legacy for your family could have several key benefits. Read our latest guide to discover some of those advantages, as well as the potential downsides.

Leaving wealth behind for your loved ones may be a priority when developing your financial plan. After all, you’ll likely want to see your family thrive and an inheritance could help them achieve important goals in life.

Leaving an inheritance could also help give you peace of mind as you know those close to you will be financially secure after you’re gone.

Traditionally, you would transfer wealth to your loved ones when you passed away, leaving instructions in your will about how your family should divide your estate.

However, in recent years, more people have chosen a “living legacy” – passing wealth to their loved ones while they’re still alive – instead.

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To learn more about how our financial planners can help you stay on track to your long-term retirement goals, whatever life throws at you, email us at advise-me@fosterdenovo.com or call us on 0330 332 7866.

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Registered Office: Foster Denovo Limited, Ruxley House, 2 Hamm Moor Lane, Addlestone, Surrey, KT15 2SA.

Please note: This guide is for general information only and does not constitute advice. The information is aimed at retail clients only.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate estate planning, cashflow planning, tax planning, will writing, National Savings products or deposit accounts.

Remember that taper relief only applies to gifts in excess of the nil-rate band. It follows that, if no tax is payable on the transfer because it does not exceed the nil-rate band (after cumulation), there can be no relief.

Taper relief does not reduce the value transferred; it reduces the tax payable as a consequence of that transfer.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

Accessing pension benefits early may impact on levels of retirement income and your entitlement to certain means tested benefits.

Accessing pension benefits is not suitable for everyone. You should seek advice to understand your options at retirement.

The tax implications of pension withdrawals will be based on your individual circumstances.

Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.

Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it.