Four surprising assets you could be overlooking in your estate plan

When you think of your estate, your mind likely goes straight to the major pillars – your family home, pension, savings, and investments. However, a comprehensive estate plan should account for the full spectrum of assets in your possession.

Modern estates are becoming increasingly diverse and could include everything from physical heirlooms to digital assets. Not accounting for these could mean your beneficiaries miss out and may lead to unnecessary Inheritance Tax (IHT) implications.

That’s why keeping a comprehensive inventory of your estate is a vital part of protecting your legacy. To ensure nothing slips through the cracks, here are four surprising assets you could be overlooking in your estate plan.

1. Digital assets could get lost very easily

In an increasingly virtual world, your digital life could hold substantial real-world value. However, because digital assets often lack a physical paper trail, they can easily be overlooked when creating your estate plan. These can include:

• Cryptocurrency and digital wallets such as PayPal
• Monetised social media channels or websites generating ongoing ad revenue
• Active websites, online businesses, or intellectual digital media.

Without clear, written instructions and details on how to securely access these platforms, these assets could become permanently locked away in the cloud, leaving your executors with no way to recover them or their associated revenue.

2. Collectables and physical heirlooms may be worth more than you think

You may view your collection of vintage watches, fine wines, or rare books as sentimental items, but they could hold significant value that builds over time.

Professional valuations are essential here as these items could be worth more than you realise. So much so that they could unexpectedly alter your estate’s IHT liability.

Documenting them clearly also ensures that specific, cherished items make it directly into the hands of the family members you intended to receive them.

Learn more about helping your beneficiaries manage an IHT bill

3. Lost pension pots can quickly add up in value

It’s incredibly common to lose track of pensions from previous employers, especially since auto-enrolment has made having multiple workplace schemes the norm. You may have even forgotten about one or two older pots and could be leaving valuable money on the table.

Research from the Pensions Policy Institute reveals that there is a staggering £31.1 billion sitting in unclaimed, inactive, or lost pension pots across the UK. That’s roughly 3.3 million lost pots, averaging £9,470 each. This figure rises to £13,620 for those aged between 55 and 75.

You can use the Government’s free Pension Tracing Service to locate forgotten schemes, which you can then factor into your broader estate and tax plans.

4. Intellectual property and royalties could continue providing an income

If you’ve written a book, secured a patent, registered a trademark, or earned royalties from creative works, you own intellectual property. These are unique assets because they can continue to generate a steady income stream long after you are gone.

Your estate plan must specify who inherits the rights to these works and who will manage the ongoing royalty streams. This ensures that your creative legacy continues to support your loved ones as you see fit.

There are three primary advantages to having a complete overview of your estate

Taking the time to build a clear and comprehensive inventory of your estate has three notable benefits for you and your family. It can:

1. Make the process of distributing your estate seamless for your executors. Providing an organised, up-to-date assessment of your estate can make it simple for your executors to locate, value, and distribute your estate exactly as you wished.
2. Maximise your tax efficiency. Though you may have forgotten about an asset, it is still likely to be found and included in your estate’s total valuation upon your passing. If an unrecorded pension or valuable collection pushes your total estate over the IHT nil-rate band, your family could face an unexpected bill. Documenting everything allows for precise, proactive tax planning to maximise what you can pass down. See the article below for more information about IHT.
3. Help reduce any potential family disputes. Ambiguity is often the primary reason behind inheritance disputes. Clearly detailing what you own, where it is held, and who you want to inherit it leaves no room for misunderstanding. This could protect your family’s relationship when it matters most.

Read more: Will you have to pay Inheritance Tax? The rules explained…

Get in touch and let’s work out a plan for your estate

Writing a will isn’t a “set it and forget it” process. After all, it’s an overview of your life’s work.

By working with a Financial Planner, you can build a complete and structurally sound roadmap that protects every asset you own, no matter how small or surprising.

We can help you gain clarity over your estate plan.

Email us at enquiries@pen-life.co.uk or call 01904 661140 to learn more.

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.

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available.

The Financial Conduct Authority does not regulate estate planning, will writing or most crypto assets/services.

Remember that taper relief only applies to gifts in excess of the nil-rate band. It follows that, if no tax is payable on the transfer because it does not exceed the nil-rate band (after cumulation), there can be no relief.

Taper relief does not reduce the value transferred; it reduces the tax payable as a consequence of that transfer.