Whether you realise it or not, you have an estate. Lots of people are unaware of what makes up an estate, and therefore are under the impression that they don’t have one. However, most people do in fact have one even if it is a small one. Have you ever heard of estate planning? If not that’s okay, because we are going to be discussing it down below.
What Is An Estate?
An estate is made up of everything you own. This could be a house, any sort of real estate, a car, personal possessions, any investments, life insurance policies and so on. There are a number of contributing factors that all add up to make your estate and whether it is large or small, it still exists.
What Is Estate Planning?
To put it simply, it is planning for what happens once you die. After you pass away, you want to know that all of your stuff is being passed on to those who you love. Each person gets what you have decided, and you need to make it clear who gets what of your estate. After reading this explanation of estate planning, this might be ringing a bell in your mind that you have heard this before. That is because many people talk about this through their life, what happens to their items when they are no longer around. If you want to have some control over what happens to your estate, it is vital that you start your estate planning soon.
Who Needs Estate Planning?
Everyone. Too many people think that this is only for people who are in their elder years, or in their retirement stage. You never know when your time is going to come, and you need to have planned for it no matter what age you are. It is also the case that you should be estate planning even if you only have a small estate. It is important that you have a plan in place for your death and that is why as soon as you have something to give, you should start your estate planning process.
What Does Estate Planning Include?
Your house, your car, your savings, your investments, your personal items and everything like this all needs to be taken into consideration. But, this is not the extent of it. You also need to be leaving instructions for cases such as care for if you become disabled, an inheritance manager if younger children are involved and a life insurance policy to take care of your loved ones. Further still, you need to consider looking after people in the long term, especially those who are not very good with money.
This should be changed and updated constantly depending on how your relationships and your health evolve. This should not be a one-time thing that you do and then forget about, it should be a process.
We hope that you have found this article helpful, and now have a better understanding of what estate planning is and why you need it.
The Financial Conduct Authority does not regulate Estate Planning.