Life will eventually come to an end for all of us and that is something that most of us don’t like to comprehend. We’d rather focus on what the latest hit single is, the next sporting match of our favorite teams or perhaps when we’re going on holiday. But, the financially tough challenges that lie ahead can be dealt with now, while we are of sound mind and know what we want to give to our children and friends. Planning for death is something that can be done the wrong way or the right away. We all have choices and the sad thing is, many of us don’t know this fact of life. We can choose how we leave the world and what kind of conditions we leave our homes and valuable assets in. In fact, you can do so much more than you think, which is why we have made this short guide for you, to display the best options.
Itemize your things
If we’re going to leave this world in an orderly fashion we have to plan our departure carefully, right down to the smallest level. This can be done at home for free, without the need to hire anyone to help you. Start off by itemizing your things.
- Clothes that you want to give away or pass down as heirlooms, such as a wedding dress.
- Do you have any jewelry that is expensive? This can also be passed down as heirlooms.
- Do you have any assets such as cars and or property? These things need to be itemized too.
- Consider any stocks and shares that you may have, list these too.
The reason why you need to list your largest items first is because it allows for the smaller less valuable things to be itemized without the worry of not having enough time to plan for the more valuable things.
For your smaller items, list the following
- Clothes – shoes, jackets, coats, dresses and hats, etc.
- Electronics – laptops, computers, smartphones, TVs and modern cloud-based systems such as home sound systems and device assistants.
- China – Expensive dining plates, cutlery, crystal and or table ornaments.
- Homeware – Towels, rugs, carpets, expensive home items such as lampshades, etc.
These are the kinds of items that need to be listed. Then you can go through them all, and decide which items will be in your written will. It clears everything up and prevents you from missing any items that you will regret not including.
Non physical assets
This next category is the one that we all end up missing. But the nonphysical assets that we have, should also be prepared for your passing. This could be an ISA account, which needs to be given permission to be used as an inheritance gift. If you don’t name a beneficiary, the ISA will rest where it is for the rest of it’s account life. ISA accounts usually have a set limit as to when they can be claimed. After your death, your ISA account may not be accessible to those you wanted to have the lump sum, and after 30-40 years, it automatically shuts down and ceases to exist. The bank will simply assume the wealth you created.
So naming a beneficiary and writing them into the will is very important. However, an ISA account would fall into a probate asset, if you have named someone. Take a look at the list of Probate vs Non-Probate assets and what you can do to put your assets into the right category.
A probate asset is one that is solely owned in your name. Only one person is holding and is ownership of the asset. These could be things like bank accounts and ISA accounts. However, non-probate assets are those that are jointly held with another person. Well, if they have another person’s name involved, they will be seen as a joint owned asset. These are things such as retirement accounts, property that is shared and things like brokerage accounts.
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Make copies of your lists
You need to make a copy of all the lists you make because you may want to change them as things change in your life as well. Circumstances don’t always stay the same and the people who you have put on the list of beneficiaries may change. A person might pass away or they don’t want to be part of your will. That’s why creating copies of your lists is so important.
You can do so just by copying them and printing them but keeping them in a safe place is vital. You can do so in a safety deposit box which can be rented for a reasonable price. Keeping your papers in these boxes that are guarded and secure, is a great way for you to maintain your knowledge of your own will. It’s also a good idea to do this, when you feel like you’re being pressured by someone. Your family members might try to persuade you to change your will even though you won’t want to. So keeping a copy of everything, who you want to leave behind something and who you’d rather not, is a good way to remain autonomous.
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Update your insurance policies
If you would rather pass on your insurance plans to another person, you can consider changing them. Many insurance companies don’t overtly offer this type of ownership transfer service but they can do so if you choose to do so. However, as you would expect they want to be paid extra and they need you to pay for all the legal costs. It may also need several forms of consent such as video proof, documents, emails and signatures.
However, you can pass on an plan to a child. This is useful for when you have a great home insurance policy that you want to keep, even after you have passed away. The person who inherits the home will also inherit the insurance plan. This can give you peace of mind, knowing that the home is covered and that your asset will be protected financially.
Draft the will
You’re not on death’s door yet!
So you should make drafts of your will, until it’s time to make the real thing. Why? Well, you don’t want to write a will and then not be able to change it so fluidly. You’re in your 70s and you’re writing a will, you may live to 80 or 90. So you would stay the same for another 15-20 years. That is just not thinking right, as a lot can happen in that time. You will also have more heirs, in the form of grandchildren. So, are you going to leave them out?
No, of course not. So drafting a will, allows you to stay fluid. You can make your draft the real thing if you want to, in the case that you do pass away suddenly. The draft will become your real will after a set period of time or when an event has triggered this clause. Depending on the complexity of the assets you include, you may not wish to sign the will until you are sure of something. This could be that a contract is due to change or be renewed in one year’s time, so you’d rather wait to see what is going to happen with property or something else before you will become notarized.
Include new assets
As your wealth grows so too will your need to update your will. As you accumulate new assets, you will require new paperwork to add to your will. Certification of your assets is needed first, so you can show that you are the true owner of the property, car, or perhaps jewelry of some sort.
This can be done not just by the receipt of sale, but owning the history deed of an asset. This can be given to you by a local authority if it’s a property. If it’s a stock or bond, you can still ask for the history of ownership from the relevant authorities.
You’ll also need to have the paperwork for the valuation and the inspections. This is because assets naturally depreciate, so you need to have an accurate estimate of what their true worth really is. But why is this important? Well, it is so that the will can be accurately worded. An asset at the time of inclusion will be valued and therefore, the size of your will, will be weighed. Any taxes that need to be added upon inheritance will be affected by this.
Planning for your departure from this earth can be daunting and somewhat morbid. But we have to take our time and plan ahead. It’s a good idea to first learn what a non-probate and probate asset is. You should also get the required paperwork for your assets that is up to date. Make copies of all your lists, including items, assets, stocks, and other important items.