For professional advisers and paraplanners only . Not to be relied upon by retail investors .

Carol hadn ’ t heard about this option before . It changed her perception of estate planning .

Jessica Franks Head of Investment Products Octopus Investments

Financial advice adds tremendous value to clients during uncertain times and where a client feels anxious or reticent to make decisions for the long term .

This is especially true of estate planning , where uncertainty and complexity can weigh heavily on families . The potential cost – both financial and emotional – of delaying inheritance tax planning are significant . Advice has an important role in ensuring good outcomes .

An issue that comes up fairly often in estate planning conversations is , what can you do if a client has a substantial inheritance tax liability where gifting is an obvious option , but they just don ’ t want to give away a large sum of money ?

There are several reasons why that might be the case . A client may have beneficiaries they consider are too young to inherit now , and may also consider trusts too expensive or complicated . They may be concerned about possible future care costs . They may worry they won ’ t live seven years . Or they may simply feel uncomfortable giving away a lot of money that ’ s taken a lifetime to build up .

Carol thinks estate planning means giving up control of assets

Meet Carol . She is a retired civil servant in her mideighties , in good health and is very independent . Her late husband left her assets valued at just over £ 1.5 million , including a house worth £ 900,000 , a large investment portfolio and some savings held in cash and fixed-term bonds . She has a defined benefit pension that covers her day-to-day expenses .

Carol meets with Ben , her financial adviser , who brings up the topic of estate planning . Carol understands that , without any planning , her estate will leave her beneficiaries with an inheritance tax bill . Nonetheless , she raises a number of questions when Ben runs through her options .

“ What if I need it ?” she asks when they talk about gifting . Carol also mentions she isn ’ t keen to gift due to concerns about her daughter ’ s marriage , and is wary of her son-in-law getting some of her money if he and her daughter divorce .

The bottom line , Ben realises , is that Carol is a client who is determined to keep her options

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