As the kids head back to school, this is often a time to reflect on the summer that was and the school year ahead. Many families take this opportunity to assess their current financial arrangements to accommodate the costs associated with raising kids, from daycare costs to post-secondary education. This is also the perfect time to reassess your estate planning documents and make a will.
Estate Planning Elements
A well-drafted will can go a long way in ensuring that your wishes are met and your assets handled in accordance with your wishes upon your death.
The first element needed to draft a will is to name an executor.
The executor is the trustee of your estate and the person who steps into your “financial shoes”. This person will also have the duty, upon your death, to liquidate your assets and pay your debts. This can be a spouse, a child, or any other party that you deem would be up to the task. In some cases, it may also be beneficial to appoint a corporate executor; the trust department of a bank or trust company to act as your executor. You can make a provision in your will to limit, or expand, the powers that are otherwise given to the trustees by law.
The second element needed is to name the beneficiaries under your will.
The beneficiaries are the individuals who will receive the remaining assets under your will after the debts and taxes are paid. Your direction under your will can also provide for specific bequests of personal assets such as heirlooms or collectable items — it also allows you to plan for children, grandchildren, and other loved ones whom you wish to provide with a bequest.
In addition, your will can also provide some additional tax planning tools which will allow your estate trustee to minimize the taxes payable by your estate upon your death. Designating beneficiaries under life insurance policies, joint ownership of property or bank accounts, and other similar strategies will assist in this process.
Get The Facts
It is important to dispel the myth that the government inherits, or decides, who your beneficiaries are going to be should you die without a will. The Succession Law Reform Act provides for a distribution scheme for one’s assets if you die intestate. Although in some cases this distribution is satisfactory, it may not meet your wishes — especially if you are in a second marriage or common law relationship and wish to provide for your spouse at the time of death.
Finally, it is important to note that a well-prepared will does not need to be complicated or costly and will, in almost all cases, assist in reducing the overall costs and time required to deal with a deceased’s estate.
For more information about estate planning or drafting a will, contact Brown Beattie O’Donovan LLP. Our estate planning experts are here to help you protect your assets and your wishes.