Nobody wants to ponder death, but nobody escapes it. Even if you’re young or middle-aged and feel the end is decades away, it’s important to dot your “Is” and cross all your “Ts” while you’re still living – because nobody knows what may happen tomorrow. If you have children, ensuring the bureaucratic side of death is taken care of while you’re alive is even more pertinent. Here are three essential formalities you must arrange if you’re a parent – just in case.
Take Out a Life Insurance Policy
Life insurance is a must to ensure your family’s living expenses, education costs, and care are covered in the event of your death. It’s much more affordable than most people think, although it does increase in cost with age. The peace of mind and familiar financial security a live insurance policy provides are worth the price, particularly if you have dependant children or someone within the family who is ill or disabled.
However, life insurance must not be confused with Mortgage Protection policies – banks require this to ensure your home is fully paid for if the owner passes away and is more for the bank’s protection than anything since its payout goes to the lender (the bank). Life cover, however, goes to the family of the deceased.
Make a Will
A will is essential for ensuring family members receive what you want them to after you pass. Other benefits of arranging a will include:
- You choose who benefits from your estate (and who will not)
- You can select your estate’s executor
- A will quickens the probate period
- A will could lower the cost of inheritance tax your loved ones pay
- If you wish to, you can give donations to charities or causes you care about in your will
- You can decide who cares for your children if they are under the legal. Without a will, the court can appoint a relative, or if a family member does not wish to care for them, they may end up a ward of the state and enter the care system.
That said, a will doesn’t mean drafting everything on a piece of paper and keeping it in a file at home. It must be created properly and legally with a notary to officialize it to ensure its legitimacy and reduce the risk of contention or overhaul.
In many cases, people do contest wills, which can result in lengthy legal procedures. Of course, it’s not as simple as protesting it; there must be a valid reason. The grounds for contesting a will can apply in certain cases, but to mitigate this strife in the aftermath of your death, it’s vital to create a fair will with a legal and official body.
Review Investments & Assets
A list of all assets and valuable items is essential, as is noting them in your will and how they will be distributed. Over time, people may gain or lose assets and valuables, which is why this list requires review regularly, perhaps yearly.
As well as assets, existing policies and pensions that pay out need to be reviewed. You should ensure the details you have on any policies and pensions are up to date and that the right beneficiaries are listed on each one. Reviews also extend to bank accounts; do your accounts automatically transfer to a nominated person upon your death, or will they go to probate? Put in place what you want to happen.