What is a letter of wishes?
A letter of wishes is an informal document that sits alongside your Will and sets out guidance for your Executors and Trustees.
You can set out how you would like things to happen after your death in your Will. However, you may be willing to leave it up to your Executors to make final decisions. Your Executors are those responsible for dealing with your estate once you die, as named by you in your Will.
If you choose to leave some decisions up to your Executors and Trustees, you might consider writing a letter of wishes. This letter, addressed to your Executors and Trustees, would include a description of what you would like to happen, and indicate that you are willing to leave it up to them to decide how best to achieve this given the relevant circumstances at the time. Your Executors and Trustees are not legally bound to follow your wishes, but it is likely that they will do so, especially if you have taken care to appoint suitable people.
It is particularly important that you leave a letter of wishes if you have a created a discretionary trust in your Will. A letter of wishes will provide your Trustees with essential guidance as to your wishes on how you would like your estate to be distributed.
Advantages of a letter of wishes
Unlike a Will, a letter of wishes is not a legally binding document. However, it helps to make your wishes – and your Will – clearer. It is particularly appropriate when dealing with personal property that has sentimental value. Listing all of these in detail in the Will can make it a very lengthy and complicated document. To avoid this, all personal possessions can be given to one person (or to your Executors) in the Will, along with a letter of wishes indicating how they should be distributed.
Amending a letter of wishes is easier than amending a Will. All you need to do to amend a letter of wishes is to create a new one and sign it (no witnesses are required). You don't need to alter the Will itself, which makes changing your mind straightforward.
A letter of wishes can be a private document, whereas a Will is a public document. So if your reasons for wanting things to be arranged in a particular way are sensitive or confidential, a letter of wishes is more likely to keep them so. (But remember, Executors might have to produce it later to show that they have been following your wishes.
Wishes in connection with guardianship
One particular way in which a letter of wishes can be used is when you have appointed certain close friends or relatives to be your children’s Guardians. It might be that you have a particular preference regarding one or more aspects of your children’s upbringing in the event that you pass away – perhaps to do with their education or religion. You can include these wishes in a letter of wishes, which can serve as useful guidance to the Guardians.
Wishes in connection with gifts
While guardianship is an important reason for leaving a letter of wishes alongside your Will, it is not the only one. There are other common occurrences, including:
Gifting your personal possessions to a specific individual or to your Executors to distribute, with a letter of wishes saying who you would like those personal possessions to pass to.
Listing your main assets, such as bank accounts and insurance policies, to make it easier for your Executors to identify and administer your estate. Providing such lists can help to reduce the administrative burden on your Executors during a difficult time.
Giving guidance to your Executors about the sort of charity you would like to leave gifts to (for example if you have named a charity that no longer exists at the date of your death).
Explaining the reasons for particular legacies – especially unexpected ones that may come as a surprise to your family. This is not so common, but important, particularly if you are intending to exclude family members from inheriting.
If you leave your estate in discretionary trusts in your Will, a letter of wishes can indicate your reasons for doing so and who you would like to be the primary beneficiaries of the trusts. A discretionary trust is one where the Trustees have discretion as to how the contents of the trust, such as money or property, are distributed to the beneficiaries (the people who you would like to benefit from the trust).
Making a letter of wishes
While a letter of wishes still needs to be signed by you, it does not need to be witnessed, so you can avoid the formalities involved with signing a Will. A letter of wishes should be stored alongside your Will but not physically attached to it. This is because any resulting marks on your Will, such as paperclip marks, might imply that there was a document amending your Will, or even that there was a new Will. This could result in the validity of your Will being called into question. It is important to tell your Executors about your letter of wishes and where to find it.