5 vital but difficult questions to ask family members

Sarah Coles · Personal Finance Columnist

Sun, Apr 27, 2025, 11:00 PM 5 min read

Do they have a lasting power of attorney?

This is a legal arrangement, letting them nominate someone to make decisions for them if they eventually lack the mental capacity.

There are two types of lasting power of attorney (LPA) — one will enable someone to make medical choices for them and the other will let someone handle their property and finances. It means someone they trust can step in if they’re unable to stay on top of the day-to-day finances, or if someone needs to use their assets to help pay for care.

Do they have a will — and is it up to date?

Two thirds of Brits have no will, and it can cause serious financial problems for those they leave behind.

If they die without one (which is known as dying intestate) the estate is divided according to specific rules, rather than how they might want.

If they’re not married, the rules can be particularly harsh, because a partner may inherit nothing — the estate will pass to children, parents and siblings, in that order.

Even if they’re married, their spouse doesn’t inherit everything, because if they have children, they may be entitled to some of the estate too.

Once they’ve made a will, they need to keep it up to date. If their circumstances change it needs to reflect their new situation.

Old woman drinking cup of tea with her home caregiver, sitting on patio during warm winter day. — If we don’t have key conversations with older members of the family, it will make life even more difficult when they pass away. · Halfpoint Images via Getty Images

Do they have a list of everything they own and everything they owe?

It’s worth them taking steps now to take some of the pain out of the "sadmin" after their death.

Most people will build up a number of pensions, ISAs and savings accounts, during their lifetime, so they can consider consolidating them where possible, closing old current accounts, and bringing things together.

They need to be careful not to give up any valuable benefits, but this process not only saves extra admin for their loved ones, but can make their own financial life much easier to manage as they go along too.

Then they need to make a list of every account, and keep it alongside their will and lasting power of attorney, so their loved ones know where to find everything.

Have they considered the cost of care?

The huge potential costs mean they need to think things through. They might have assumed their family will care for them when the time comes, but if this isn’t practical, it’s worth having the conversation sooner rather than later.

If they might need formal care, charges of £1,500 to £2,000 a week are not uncommon. It means they need to factor in the potential costs when considering what to do with their assets, especially when they’re thinking about making gifts to family, so they don’t give away too much too soon.

There’s a good chance many people will need to use the equity in the family home, so they may want to discuss what they want their family to do with it in advance — whether it’s renting it (although you need to consider the risks and costs), selling it, using equity release, or entering into a deferred payment agreement with the local authority (which means care home costs roll up and are paid when the property is sold).

The right solution will be different for everyone, but they need to consider the options carefully.

Have they thought about inheritance tax?

It can be difficult to pitch this question, because there’s a fine line between being helpful and seeming greedy. However, with inheritance tax thresholds frozen, house prices so high, and new rules set to bring pensions into the mix, they might end up with a tax bill that’s worth considering.

The vast majority of people will be protected by the nil rate bands of £325,000 and £175,000 for property left to children or grandchildren. If they’re married and pass everything to their spouse, then their nil rate bands will pass too, so £1m is tax free on the second death.

However, it’s worth them considering how much their estate might be worth, and whether tax could be an issue.

They shouldn’t feel forced to give away assets they can’t afford, but if they’re set to bust the nil rate band there are gifting allowances that can help. They can give away up to £3,000 a year, plus wedding gifts and gifts from surplus income that pass out of their estate immediately for inheritance tax purposes. They can also leave bigger gifts and as long as they live for another seven years these will also fall out of their estate.

If they have younger family members who are struggling to take key steps with their finances — like buying a house or retiring — a gift could make a world of difference and ease the tax burden too.

Read more: