Ensuring you have some provision in place to protect the people who depend on you financially can make a big difference to you and your loved ones' financial wellbeing now and in the future.
Here are five practical steps you can take to help you start safeguarding what matters most.
1. Put a will in place
A will is one of the easiest ways to make sure everything you leave behind is handled the way you want. It helps avoid confusion, reduces stress and avoids delays for loved ones and is often quicker and cheaper to set up than people expect.
If you have children, naming a guardian removes uncertainty about who would care for them. You should also leave guidance about pets, so they continue to be cared for properly. A short conversation with your family can help everyone understand your wishes. Learn more about wills and how to find a reputable will writer.
Some charities offer free will writing for a donation, but always check the writer is reputable.
Trusts may also be useful if you want someone to manage money for children, disabled or vulnerable relatives. Financial advisers, specialist solicitors, disabled or mental health charities and Citizens Advice can help you explore this further.
2. Get your digital life organised
Most of us have dozens of online accounts and subscriptions we rarely think about. Keeping a simple list and making sure your will reflects what exists saves loved ones time and stress later.
Whilst you’re at it, you can check your beneficiary nominations are up to date. You can usually name beneficiaries on pensions, workplace death in service schemes and life insurance. These nominations, although not legally binding, can guide trustees and administrators which means payments can reach the right people quickly. You can update your Aviva beneficiaries through MyAviva.
3.Set up Lasting Powers of Attorney (LPAs)
A Lasting Power of Attorney (LPA) lets someone you trust make decisions if you lose mental capacity. There are two types of LPA:
- Property and Financial Affairs, covering your money, bills and home
- Health and Welfare, covering your care, daily support and treatment
LPAs only apply once capacity is lost and are straightforward to set up online or through a professional. And safeguards are in place to avoid misuse.
4. Check what support you might be entitled to
Many people are eligible for help without realising it. Personal Independence Payment and Attendance Allowance aren’t means tested and can support those with long term conditions or disabilities, including children. They can also unlock things like:
- Council Tax reductions
- Blue Badges
- Carer support
- Travel or mobility help
Means tested benefits like Tax Credits may also offer support depending on your situation. If you're worried about money, Citizens Advice can provide guidance and Turn2Us has a helpful tool to check eligibility.
5. Review what you have in place and work out what else you need
Start by thinking about what matters most, for example, protecting your income, your home or your children’s future. Then look at what you already have, including workplace income protection, death in service benefits, bank account extras or older policies. Aim to build a savings buffer of at least three months of spending if you can.
Once you understand where any gaps may be, you can review the range of protection options on the market to see if any align with your circumstances. There’s no requirement to take action, but being aware of what exists may help you make an informed choice.
- Level Term Assurance, gives your loved ones a fixed lump sum if you pass away during the policy term.
- Decreasing Term Assurance, helps cover things like a repayment mortgage as the payout reduces over time.
- Critical Illness Cover, pays out if you’re diagnosed with a specific serious illness, so you can focus on getting better.
- Income Protection, replaces part of your income if you can’t work because of illness or injury.
- Family Income Benefit, provides your family with a regular income if you die during the policy term.
- Eligibility and cost depend on things like age, health, lifestyle, job, inflation proofing and the level of cover you choose. Many life insurance products can be placed in a trust which helps beneficiaries receive payment quickly and in some cases reduce inheritance tax.
- Other options like Bill Protection, Accident Insurance, Cash Savings Plans and Pet Insurance may also be useful depending on your situation and budget.
Try to find a balance between cost and what you need and check your plans regularly as life changes. You can learn more about protection at MoneyHelper.
Shop around and check that your product provider is FCA regulated
An FCA-authorised firm is regulated to meet strict standards, protect clients, and may offer compensation via the Financial Services Compensation Scheme (FSCS) if things go wrong.
For tailored advice you should speak to your financial adviser. If you don’t have an adviser MoneyHelper provides up-to-date resources to help you find regulated advisers. Advisers may charge for their advice but, there are usually a number of ways to pay.
