As part of Dying Matters Awareness Week, people are being encouraged to talk about dying and bereavement, so nobody has to face grief on their own.
Amid the coronavirus pandemic, Sarah Coles, personal finance analyst at financial service company Hargreaves Lansdown says: “We’ve all considered our own mortality more often than usual in the past few months — and what would happen to the loved ones we leave behind.
“If the worst was to happen, there’s no way to lessen the pain of grief, but we all owe it to our family to do what we can to avoid adding to it.
“One of the horribly unfair things about bereavement is that while you’re facing an emotional crisis, you somehow have to be capable of dealing with all sorts of complicated financial and administrative things at the same time.
“So while we can’t help our family bear the pain of losing us, we can take some sensible financial steps now to avoid adding the stress of trying to get your affairs in order while they’re going through a horrible time.”
Here are seven steps from the experts at Hargreaves Lansdown to help ease the financial stress of bereavement:
Make a will
Almost two thirds of Brits have not made a will, which can end up causing serious financial problems for your loved ones.
If you die without a will (known as dying intestate) your estate is divided according to particular rules, which may not follow how you actually want to leave things. For example, if you’re not married to your partner, they may inherit nothing.
It is important to make it clear in your will how you would like any dependents to be cared for.
You should name a guardian who will look after any children if both parents were to die — and speak to any potential guardians in advance to make sure they are happy with the responsibility.
READ MORE: The six ways a will can be challenged
You can also leave trusts for dependents in your will. Assets can be left in trust for children under 18, so they can be managed by an adult until they are old enough to inherit. This can be particularly useful in families where a parent has re-married, to protect the inheritance of children from a former relationship.
Make a lasting power of attorney
Power of attorney is a legal arrangement that allows you to choose someone to make decisions for you if you’re unable to make them yourself.
There are two types: one authorises someone to make medical and welfare choices for you and the other allows them to handle your property and finances. This gives someone you trust the ability to step in if you are unable to stay on top of money matters.
Make an assets register
The best way to make sure your family knows about all your assets is to leave a detailed list known as an assets register.
This should include all your accounts, investments, pensions, life insurance, debts, mortgage and any insurance that covers the mortgage. Keep this list safely with your will.
Simplifying and consolidating your assets will make things easier for your family. Look at what you can consolidate without losing any valuable benefits, such as current accounts, old savings accounts and share certificates.
Consider using an investment service where you can keep different kinds of investments in one place.
Get your paperwork together
Keep all your paperwork and accounts together. This includes account details and statements, but also important paperwork like birth and marriage certificates, divorce decrees, and name changes by deed poll.
If you complete a tax return, the executor of your will will also need the information required to fill out a return for the final year.
Consider day to day money
While your estate goes through probate — the judicial process whereby a will is proved in a court of law and accepted as a valid public document — your accounts will be frozen. So it’s worth making sure that your spouse or any other recipients have a reasonable sum of cash in their own name, so they have access to any cash they might need during the process.
Many couples choose to have a joint account for this purpose, which passes directly to the other account holder before probate.