Please forgive me for recommending some new year resolutions for you to think about that focus on worst case scenarios, but they deserve consideration by every one of us.
Do you have an up to date Will that reflects your current wishes? Wills are something that, understandably, many people don’t want to give thought to but it’s very important that you have a valid Will and that it is kept up to date or you may cause unnecessary suffering to those you leave behind on your death.
Many people elect to have a simple Will but attach to it a detailed letter of wishes which they can easily amend every couple of years depending on changes in circumstances, without having to go through the bother of updating the Will each time.
Lasting Power of Attorney (LPA)
Do you have a Property & Financial Affairs LPA which appoints someone to manage your financial affairs in the event of your losing mental capacity either through an accident or through dementia? If you don’t, you could make life extremely difficult for those who need to care for you.
If you have specific wishes about how you would like to be looked after from a health care perspective should you lose mental capacity (for example that you would rather be looked after in your own home than be placed in a care home) then this can be documented in a separate Health & Welfare LPA.
Do you have any insurance in place that would pay out a lump sum to your spouse to compensate them for loss of income or to allow them to repay the mortgage in the event of your death? The younger you are, the cheaper life insurance is: it can prove extremely good value as well as delivering peace of mind for those closest to you.
Critical illness insurance
If you were to suffer a career ending illness or injury, how would you and your family cope financially? Critical illness cover pays out a lump sum on diagnosis of specific illnesses.
Have you told your pension provider who you would like to receive your pension in the event of your death? Your pension fund is, confusingly, not part of your estate and will not automatically pass to the beneficiaries of your Will. You need to make a specific nomination by writing to your pension provider. This will normally be something that your pension provider asks you to do when your pension is set up but it is worth checking that you have one in place and that it reflects your current wishes.