If you don’t have children, do you need an estate plan? Yes, and here’s why

You might think that if you have no children or obvious heirs to inherit from you, there’s no need to write a will or create an estate plan.

Indeed, The National Wills Report 2024 showed that just 39% of childless UK adults have a will compared to 61% of those with children.

In fact, making plans for passing on your wealth is an important step, whatever your personal circumstances are. However, you may need to take a different approach if you don’t have any direct descendants.

Keep reading to learn why estate planning is crucial for childless single people and couples and discover practical ways to get started now.

Why estate planning still matters if you don’t have children

An estate plan sets out how you want your assets, healthcare, and finances managed if you lose capacity or pass away. It may include documents such as a will, trusts, and Lasting Powers of Attorney.

This is an important part of your financial plan, whether you have children or not, because it allows you to:

• Ensure your estate is passed on in line with your wishes, rather than the rules of intestacy (these are used to decide who inherits when someone dies without a will)
• Choose a trusted person to make decisions about your health and finances if you become too ill to do so
• Provide for cohabiting partners or other chosen beneficiaries
• Reduce emotional and financial stress for your beneficiaries
• Minimise the risk of disputes and legal challenges
• Pass your wealth on as tax-efficiently as possible.

In other words, putting an estate plan in place gives you control over how your wealth and wellbeing are managed in the future.

How estate planning may be different if you have no direct descendants

If you don’t have any “automatic” next-generation beneficiaries, you’ll need to think carefully about who you want to pass your estate on to.

While not having children could give you greater freedom to choose how your assets are distributed, it may also feel more complex and daunting.

Without the traditional family structure, your estate plan is likely to centre on other relationships, such as those with your partner, friends, nephews and nieces, or even beloved pets.

You might also want to consider leaving a meaningful legacy by supporting a charitable cause that matters to you.

Key Inheritance Tax considerations

Inheritance Tax (IHT) is normally charged at 40% on the portion of your estate that exceeds the available threshold. The nil-rate band allows everyone to pass on up to £325,000 (2026/27) without triggering an IHT charge.

You might think that you don’t need to worry about IHT if you have no immediate successors. In fact, IHT planning is even more crucial because you may be entitled to fewer exemptions.

Indeed, the residence nil-rate band is only available to a person who leaves their main home to direct descendants (children, stepchildren, or grandchildren). This is an IHT-free allowance of £175,000 in addition to the nil-rate band. In other words, a parent or grandparent could pass on up to £500,000 tax-efficiently.

Moreover, the nil-rate band and residence nil-rate band can be transferred to a surviving spouse or civil partner.

As such, married couples or those in a civil partnership with children could potentially benefit from several IHT exemptions and allowances that are not available to single people and childless couples or individuals.

Consequently, careful planning is essential to ensure that you make the most of any opportunities to reduce a potential IHT charge on your estate. For example, you could leave 10% or more of your estate to charity, reducing the IHT rate from 40% to 36%.

6 practical steps you might want to consider, and how we can help

It’s never too early to begin estate planning.

If you don’t have children but you want to take control of your future, here are six things you might want to consider:

1. Writing a will

This is a legally binding document that allows you to set out who you want your assets to go to. You can also choose executors to carry out your wishes, name guardians for your pets, leave charitable donations, and state your preferred funeral arrangements. It’s crucial to review and update your will if your circumstances change.

2. Registering Lasting Powers of Attorney

Setting up Lasting Powers of Attorney allows you to choose a person or people you trust to make important decisions about your health and finances if you become unable to do so.

3. Gifting some of your wealth during your lifetime

Putting lifetime gifting strategies in place could be a useful way to reduce the value of your estate for IHT purposes so that more of your wealth goes to the people and causes you love.

4. Setting up trusts for your chosen beneficiaries

Trusts can allow you to provide for a loved one after you’re gone, while retaining control over when and how your assets are passed on. For example, you might place some money in trust for your niece or nephew to use for higher education when they turn 18.

5. Writing an “expression of wishes”

Besides property, pensions are often one of the most valuable assets a person owns. An expression of wishes is a form you can use to state who you want to receive your pension benefits when you pass away.

6. Speaking to a financial planner

Estate planning for single people or couples who have no children can be complex. A financial planner can provide advice and guidance tailored to your specific needs and goals. They can also help you understand and navigate IHT rules so that your chosen beneficiaries receive as much of your wealth as possible.

Get in touch

If you don’t have any direct descendants but want to take control of your future, we can help you create an estate plan that sets out your wishes.

To find out more about how we can help, please get in touch by email helpme@aspirellp.co.uk or call 0117 9303510.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.

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, tax planning, trusts, Lasting Powers of Attorney, or will writing.

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.

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.