Beware the scourge of the “Mirror Wills”

Here at Prior Knowledge, the starting point for couples is almost always the Mirror Will: “When I die it all goes to her; when she dies it all comes to me; when we both die, it all goes to the kids”. Sounds perfectly logical and reasonable, right? Well, actually….not really!

Why, you ask? Well, for nearly 20 years now we have been advising clients NOT to stick to what sounds like the accepted norm. And for very, very good reason.

Spouse 1 dies. Spouse 2 then inherits the lot. Spouse 2 then remarries.Spouse 2 then dies, and Spouse 3 then inherits the entire estate of Spouses 1 & 2 and is then free to do with that estate as they see fit, meaning that the children of Spouses 1 & 2 get….NOTHING! Don’t just take my word for it. The BBC, Daily Mail and others have all been reporting on the prevalence of such scenarios. The latest such story was reported in the award-winning ‘This is MONEY’ website.

Janice Chapple’s mother Phyllis, had promised Janice that she would inherit all of her worldly possessions. Phyllis had drawn up a mirror Will with Janice’s stepfather Vic, and explained to Janice that whoever died first would leave their estate to the other. Then, when the surviving partner passed away, the couple’s joint finances would go to Janice, who was an only child.

So when Vic died the following year, Janice, 74, was devastated to learn that he had left all of Phyllis’s belongings – including her home – to his cleaner. Unbeknown to Janice, Vic had rewritten his will.

The article says: “Mirror Wills are a popular mode of arranging legacies. This is where two partners sign identical wills, leaving everything to the other initially, with assets to be split between their named beneficiaries after the second dies. However, in the case of blended families, they can become contentious. That is because a legal loophole allows surviving spouses to alter or entirely rewrite a Will after a partner dies. This enables the surviving spouse to cut out their deceased partner’s family altogether. There are no restrictions on altering a mirror will after a partner’s death. In Janice Chapple’s case, it meant her stepfather could inherit all her mother’s wealth – then leave it all to his cleaner.”

There is also the issue of long term care fees to consider. If Spouse 1 dies and leaves it all to Spouse 2, and Spouse 2 then goes into long term care, the local authority can then use everything that Spouse 2 owns, as part of the means test….including Spouse 1’s share. So, in that scenario, if the survivor needs care, the whole estate can be used to pay for THEIR care, even the share of the deceased, who isn’t even in care, because they are predeceased.

The above scenarios are common. I estimate that 40% of clients I see know of someone directly or indirectly where this has happened.

So, if you wish to be do things properly, please contact us for your FREE, non-obligatory consultation.