Life insurance & Wills for beginners

The_Palmist

Dear Forum Members,

I have been thinking about life insurance and wills. My key concerns are

* couple's life insurance for both of us [wife and I]
* will in the event of death of 1 or both or entire family
* critical illness cover - it seems very expensive
* all direct debits, legal paperworks like house deeds etc. are all only managed by me

Any pointers on where to start will be much appreciated.

My circumstances

* employed with a £500K life insurance policy from work
* additional personal life insurance for £150K
* mortgage with £200K remaining

Wife's circumstances

* employed but no work related insurance
* no debts

3 young kids between us and I would like family to be supported for next 20 years in any unfortunate event.

dunstonh

* critical illness cover - it seems very expensive

That is because you are more likely to claim on it than life assurance.

badmemory

So I will start you off with the basics.  You should both have properly written wills & both have POAs which you could do yourselves.  Whilst I am considerably older than you, I have a box file that includes lists of where any money is, a copy of my will & POAs & in your case should include any life insurances etc.  It is a very bad idea for only one partner to know what is going on with the finances.  There are so many writing on here about a partner dying & they have no idea if there is any money, how they are going to survive etc etc.  Some even have a monthly finance meeting, so both know just where they are & where they are going.  Ignorance is definitely not bliss.

The_Palmist

badmemory said:

So I will start you off with the basics.  You should both have properly written wills & both have POAs which you could do yourselves.  Whilst I am considerably older than you, I have a box file that includes lists of where any money is, a copy of my will & POAs & in your case should include any life insurances etc.  It is a very bad idea for only one partner to know what is going on with the finances.  There are so many writing on here about a partner dying & they have no idea if there is any money, how they are going to survive etc etc.  Some even have a monthly finance meeting, so both know just where they are & where they are going.  Ignorance is definitely not bliss.

Thank you that the concerns you called out are exact reason for this post. I will start with a physical and virtual box file. 

We don't have wills or POAs, this is something I need to look into.

Emmia

You should both visit a solicitor to have your wills drafted, but before your appointment have a think about who you'd like to inherit in various obvious scenarios e.g. your demise, demise of both of you,  demise of both of you plus kids... Charitable donations? Any particular things you'd like to leave to specified people?

DullGreyGuy

The_Palmist said:

Dear Forum Members,

I have been thinking about life insurance and wills. My key concerns are

* couple's life insurance for both of us [wife and I]
* will in the event of death of 1 or both or entire family
* critical illness cover - it seems very expensive
* all direct debits, legal paperworks like house deeds etc. are all only managed by me

Any pointers on where to start will be much appreciated.

My circumstances

* employed with a £500K life insurance policy from work
* additional personal life insurance for £150K
* mortgage with £200K remaining

Wife's circumstances

* employed but no work related insurance
* no debts

3 young kids between us and I would like family to be supported for next 20 years in any unfortunate event.

Why critical illness and not income protection/PHI? 

Are you going to stay with that firm until you retire? DiS is an ok benefit but have seen some get caught short when they've been made redundant or switched to another firm and suddenly in their 50s trying to get life insurance to fill the gap from DiS with a couple of chronic conditions was very expensive. 

badmemory

As for the questions a solicitor asks when writing your will.  Mine asked what if your son dies before you.  As he was in his 30s & I had just entered my 70s it had never occurred to me.  But if they don't ask those questions find another solicitor.  If a will is written correctly it will not matter if the inheritor is not longer able to rewrite their will because the original will cover it.

johncarlo

It’s great that you’re planning ahead for your family’s security. You might want to look into joint life insurance policies and setting up a trust for your will to ensure everything is well managed.