Making sure that you’ve made plans for after you’re gone can give you peace of mind. It’s not nice to think about but it means that your loved ones can carry out your wishes and be protected from inheritance tax. To make sure that you’re prepared, we’ve put together this guide to cover the basics and help with some of the jargon. Estate planning allows you to put down in words what you want to happen after your death. It’ll really help the people you leave behind to know exactly what you wanted and make it easier on them.
Sorting out your affairs with an estate plan also means:
- letting family and friends know where you keep your will.
- listing everything you own and your total debts.
- recording all the gifts that you’ve given in the last seven years to make sure you don’t pay too much tax on your estate. For more on gifts and Inheritance Tax, see GOV.UK Inheritance Tax - Gifts
- making sure your funeral preferences are known by your family.
If you want to talk about your options seek financial advice.
So, what are the key terms?
- Estate: your estate is the total of everything you own, from your house through to your smallest personal possessions. In more formal terms, it’s your net worth.
- Estate plan: an estate plan sets out how you want to distribute everything you own to the people who will inherit from you after you die.