Legacies in a will: what if there isn't enough money?
Legacies in a will: what they are and why size matters
It is natural to focus on who you want to benefit. But too many gifts, or gifts that are hard to pay, can cause real problems for your executors and leave your main beneficiaries with less than you intended.
What is a legacy?
A legacy is a gift in your will. There are three main types:
- A specific item, such as a car, jewellery or a property.
- A sum of money, such as £10,000 to a grandchild.
- The residue, meaning whatever is left once everything else has been paid.
What happens if your estate doesn't have enough cash?
An estate can look very different on paper from the cash in the bank. Someone may own a £500,000 home but have little savings, so large cash gifts cannot simply be paid out.
Debts and tax come first
Debts, funeral costs and tax are paid before anyone inherits. Unless the will says otherwise, inheritance tax usually comes out of the residue, not out of the individual gifts.
When there is not enough for every gift
- The residue is used up first. If other gifts take everything, the people sharing the residue get nothing.
- Cash gifts are cut next, all by the same percentage.
- Specific items are protected longest, and are usually only affected once everything else has run out.
A worked example: when the money runs out
Gifts that look reasonable when a will is signed can look very different years later. Here is how too many cash gifts can play out.
A will leaves £10,000 to each of two children, £5,000 to each of four grandchildren, £20,000 to a friend, some specific items to relatives, and the residue to the surviving partner. That is £60,000 in cash gifts. By the time of death, savings have gone on care costs, and only £45,000 is left after debts and tax.
| Beneficiary | Gift in the will | What they receive |
|---|---|---|
| Each child (×2) | £10,000 | £7,500 |
| Each grandchild (×4) | £5,000 | £3,750 |
| Friend | £20,000 | £15,000 |
| Specific items | Named items | Received in full |
| Surviving partner | The residue | Nothing |
Every cash gift is cut to 75%, and the partner the will was meant to protect gets nothing. This is an illustrative example.
Property and sentimental gifts can create particular issues
Leaving a property or a treasured possession may seem simple. In practice, these can be some of the hardest gifts to deal with.
- Mortgages pass with the property unless your will says the mortgage should be paid off.
- Jointly owned homes held as "joint tenants" pass to the other owner, not under your will.
- Items you no longer own mean the gift fails and the person gets nothing instead, unless your will says otherwise.
- Sentimental items such as jewellery and photos often cause arguments if the wording is vague.
Think about your executors as well as your beneficiaries
The key is making sure your gifts work alongside the rest of your estate, and that your executors can carry them out.
Lots of gifts add to your executors' workload. See our guide to what an executor does.
Questions to ask before you sign
- Will there be enough cash to pay every gift after debts and tax?
- Should some cash gifts be a share of the estate rather than a fixed sum?
Review your will every few years and whenever life changes. Sometimes a trust is a better way to handle particular assets or people.
How PJH Estate Planning can help
PJH Estate Planning can review the gifts in your will, check they can realistically be paid and make sure the people you most want to protect are not left short. Find out what you could face in your current situation with our free Estate Health Check: 10 quick questions that show any gaps in your plans. You can visit our offices, or we can visit you at home.
Sources
- GOV.UK: Wills, probate and inheritance
- HMRC Inheritance Tax Manual IHTM12086: Legacies and abatement
General information for England and Wales as at October 2026. Not legal, financial or tax advice.