Whether you aim to safeguard your personal property for the benefit of your family, support charitable organisations, or pass down cherished items, you can do so by making a legacy in your will. Here, we explain exactly what a legacy in a will is, and how the right legacy can be a lasting symbol of your life.

Writing a will is a powerful step in planning for the future. It is about more than just dividing assets; it is an opportunity to leave a meaningful legacy that reflects your values, wishes, and the mark you want to leave on the world. You can make both specific and general legacies to suit your intentions, which makes this a flexible way to decide what happens to your estate after you die.

Leaving a legacy in your will can take many forms, from financial support for loved ones to donations to causes you care deeply about. In this guide, our expert Wills, Trusts and Probate solicitors detail what a legacy is, how to leave one, and the pros and cons of legacies. As we will explain, it is important to create a legally valid will to ensure that no problems arise when distributing legacies and that your instructions are followed. 

If you have any questions we have not answered, our expert Wills, Trusts & Probate team is happy to speak to you regarding your query and provide the legal services you need. You can contact us by completing the enquiry form below or by calling 0151 666 9090.

What Is a Legacy in a Will?

In simple terms, a legacy is a gift that you leave to someone in your will. Many people decide to leave legacies in their will to loved ones or a charity close to their heart. The people who receive the legacies are called “beneficiaries”.

Legacies in wills can range from monetary gifts and property to cherished personal items or donations to charitable organisations. They are a way for individuals to ensure that a particular asset or assets are distributed according to their wishes after they pass away. They allow the testator (the person who creates the will) to support their loved ones, contribute to charitable causes, and leave a lasting impact that aligns with their values and life achievements.

Making a legacy gift requires careful consideration and planning, usually with the assistance of a legal professional, to ensure that the will is clear, valid, and legally enforceable. If your will fails to account for all the assets in your estate, challenges can arise for executors (the people who administer the deceased's estate) when it comes time for them to distribute or pay legacies to the named beneficiaries. As such, working with a solicitor can be vital at all stages of this process.

What Are the Different Types of Legacies?

When planning your will, understanding the different types of legacies you can leave is essential. This is the best way to make sure your wishes are accurately reflected and carried out, as a valid will is a legal document that must be obeyed.

Here are the primary types of legacies commonly included in wills:

• Pecuniary Legacy: This is a specific sum of money left to an individual, organisation, or charity. It is a fixed amount determined by the testator. Due to factors like inflation or changes in the estate, some testators prefer not to specify a fixed sum but instead give pecuniary legacies as percentages of their overall (or residuary) estate.

• Specific Legacy: This is a particular item or asset left to a beneficiary. It could be property, a piece of art, jewellery, or even shares in a company. Specific legacies are clearly identified and separated from the rest of the estate.

• Residuary Legacy: What remains of the estate after all debts, taxes, expenses, funeral costs and other legacies have been distributed is called the residuary estate. A residuary legacy can be left to one or more beneficiaries and often represents the bulk of an individual's wealth once all the other payments and all the legacies from the estate have been paid.

• Demonstrative Legacy: A gift of money to be paid out of a particular fund or asset within the estate, such as a specific bank account or set of stocks. If the specified fund isn't sufficient to cover the gift, the remainder is usually paid from the general estate.

• Conditional/Contingent Legacy: A legacy that is dependent on the occurrence of a specific event or condition being met. If the condition is not fulfilled, the legacy may revert to the estate or pass to an alternative beneficiary. You can also create a trust in your will to have trustees fulfil a similar purpose, which may offer more flexibility to testators who want to take this approach.

• Reversionary Legacy: This type of legacy involves an interest or asset being left to a particular beneficiary to use during their lifetime, after which it reverts to another beneficiary. For example, a house might be left for a spouse to live in until their death, after which it passes to the children. Some types of trust may also be used for this purpose, and an expert solicitor can discuss your needs to determine how best to fulfil them in your will.

Understanding these types of legacies can help you make informed decisions about how best to structure your will. There are many options that you can explore to reflect your wishes and provide for your loved ones or favoured causes. It is often beneficial to consult with a legal professional specialising in estate planning to ensure your will is valid and your legacies are clearly defined.

How Do I Leave a Legacy?

Leaving a legacy requires careful consideration and precise wording in your will to ensure your wishes are accurately reflected and legally binding. You first need to consider what you wish to leave and to whom.

Whether it is a specific gift, a specified amount of money, or a portion of your residual estate, clarity on what you want to achieve with your legacy is crucial, as it will determine the type of legacy you need.

Once you have decided the type of legacy you require the next step is to provide clear instructions in your will. This includes specifying the beneficiary's full name, the exact details of the legacy (whether it is a specific item or a sum of money), and any particular conditions you wish to apply. A solicitor can help you to make sure all of the necessary details are specified correctly.

You will also need to reflect on how your legacy will affect the recipient and whether any provisions are needed to manage this impact. For example, if leaving a significant sum to a young family member, you might want to specify age conditions or trust arrangements. You must also bear in mind that any liabilities will need to be paid before all the legacies are distributed, which will affect the value of the residuary estate. 

If you would like advice on how to leave a legacy in your will, Percy Hughes & Roberts can offer the expertise and sensitivity needed to guide you through the process.

What Are the Advantages of Legacies?

There are a number of key advantages of creating legacies within a will. Here are a few:

• Flexible control: Legacies offer the flexibility to specify how your assets are distributed, which enables you to allocate personal property and specific items, amounts, or percentages of your estate to family, friends, or charities. This control ensures that your wishes are executed precisely as you envisioned.

• Tax benefits: For many, the decision to leave a legacy can be financially strategic. Gifts to charity, for example, are exempt from Inheritance Tax, so they might reduce the overall tax burden on your estate. This means more of your assets can be used in the ways you intended and maximises their impact.

• Supporting charitable causes: For those passionate about certain causes, legacies can ensure ongoing support for charities that align with your values. This can lead to lasting change and a continuing memory of your commitment to those causes.

• Ease and clarity in estate distribution: By clearly defining your wishes in your will, you can prevent potential disputes among beneficiaries and make the estate distribution process unfold more smoothly. Legacies can clarify your intentions and reduce the likelihood of misunderstandings or family disputes.

What Are the Risks of Legacies?

As with all legal tools for estate planning, there can be disadvantages in certain scenarios. While leaving legacies in your will is a meaningful way to distribute your assets, it is important to be aware of potential risks to ensure your executors are able to carry out your wishes. Here are some key considerations:

• Asset fluctuations: The value of your assets can change significantly over time. A legacy based on today's asset values may not reflect your intentions if those values increase or decrease dramatically by the time your will is executed. This can inadvertently lead to unequal distributions among your beneficiaries. Reviewing your will regularly is vital to avoid this.

• Specific assets disposition: If you leave a specific asset to a beneficiary and you no longer own that asset at the time of your death, the intended recipient may receive nothing. This situation, known as ademption, can prevent full distribution of assets.

• Liquidity issues: Ensuring your estate has enough liquid assets to cover specific legacies is crucial. If there is not enough money to pay a specific cash legacy, for example, your executors might need to sell other assets. This could disrupt your overall plans for your estate or cause unintended consequences for other beneficiaries, as the total value of the residuary estate will decrease.

• Changes in family circumstances: Family dynamics and individual circumstances can change, potentially making your original legacies unsuitable or irrelevant. Regularly reviewing and updating your will is essential to address these changes.

• Inheritance Tax implications: The way certain legacies are structured can have significant tax implications for your estate and its beneficiaries. Without careful planning, your estate may face a higher tax burden, reducing the value of the legacies passed on.

• Potential for disputes: Without clear and precise wording, legacies can lead to misunderstandings or disputes among your beneficiaries. It is crucial to articulate your intentions clearly to minimise the risk of conflicts. Speak to a solicitor for help with the precise wording of your will and any legacies you intend to leave.

The team at Percy Hughes & Roberts advises on the creation of wills and trusts, and we can ensure that your last will and testament is legally binding and unambiguous. Seeking our professional legal assistance will ensure the legacies in your will are created with precision, care and foresight to safeguard your estate and your loved ones' inheritance.