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Disclaimer: This article is intended for the purpose of providing an estate planning checklist. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice. It does not purport to be exhaustive.
Estate planning is a crucial process. It allows you to make important decisions about the future of your assets, your loved ones, and even your own well-being.
Whether you have a complex or simple estate, putting an estate plan in place is a gift to your loved ones. Planning ahead for the future, seeking professional advice and creating estate planning documents has many benefits. It will make your wishes clear, can help you lower probate fees and minimize your estate trustee’s liability.
In this blog, we will provide an estate planning checklist with many areas to consider. Let’s delve into some of the essential decisions you must make during your estate planning process.
The importance of a proper estate plan
A well-thought-out estate plan is incredibly important. Not only does it safeguard your assets, but it also ensures that your loved ones are taken care of, and your final wishes are honored.
It will help your estate trustee make decisions and move more quickly through the probate process. Without a comprehensive estate plan, the distribution of your assets can become a contentious and complex process, potentially leading to disputes among family members.
However, it’s not just about your last will and testament. You need important documents, such as your powers of attorney, to allow someone to make critical decisions about who will manage your financial and healthcare affairs if you become incapacitated.
Who will be your executor or estate trustee?
The executor of your estate plays a pivotal role in ensuring your wishes are carried out according to your will. Typically, spouses are named as the primary executors, but it’s important to consider alternates, such as close friends or family members, in case your spouse cannot fulfill this role. You can even select two or more individuals to act as co-executors but remember that they must work jointly to manage your estate efficiently.
Your executor administers your estate and carries out many responsibilities. Learn more about choosing the right person for your estate administration here.
What assets do you currently own (including life insurance policies, digital assets, etc.)?
You will want to make an up-to-date list of your significant assets, including any life insurance policies, real property and other items. With regards to property or bank accounts, are there any of them owned jointly with your spouse?
Do you own any foreign assets? If so, note the location if outside your province. Specify the country in which these assets are located. This information is crucial for the smooth administration of your estate, as different countries have varying laws and regulations regarding foreign assets.
Who did you choose as the beneficiary when you completed the beneficiary designation for your life insurance? It’s important to ensure that your selection aligns with your estate documents.
Who are your beneficiaries?
Making a list of beneficiaries is a fundamental aspect of estate planning. Typically, spouses designate each other as primary beneficiaries, followed by their children in equal shares. Additionally, you should plan for contingencies, such as if one of your children predeceases you, ensuring their share goes to their children (your grandchildren).
Who will be your ultimate distribution beneficiaries?
Consider who should inherit your assets if none of your named beneficiaries are alive at your death and they leave no children behind. Common choices for ultimate distribution beneficiaries include siblings, parents, cousins, close friends, or charities. Your estate planning should reflect your preferences for these scenarios.
Would you like to create any beneficiary trusts?
If your beneficiaries include minors, you have the option of setting up a trust to manage their inheritance. You can choose between a “standard” trust, where the minor receives their full inheritance at a specified age (e.g., 18, 21, 25), or a graduated trust, which disburses the inheritance in stages. Clearly define the ages, amounts, and number of disbursements preferred to meet your objectives.
Would you like to create any other trusts?
Trusts can serve various purposes, from minimizing estate taxes to providing for specific needs of your beneficiaries or even supporting charitable causes. Your decision to establish additional trusts should be guided by your financial goals and family dynamics.
Who will be the guardians of any minor children?
If you have minor children, it’s crucial to appoint guardians who will take care of them if you and your spouse are unable to do so. Typically, spouses name each other as primary guardians, followed by close family members or friends as alternates. You can also designate a second alternate to ensure the well-being of your children.
With regards to your guardians, it is advisable to make sure they know that you have chosen them for this serious responsibility.
Are there any specific gifts or cash legacies you would like to bequeath?
If you have particular items or cash amounts you wish to leave to specific individuals or charities, be sure to document these in your estate plan. These specific gifts ensure that your cherished possessions and causes you care about are remembered and honored.
It may be wise to include specific gifts as a schedule to your will. For example, suppose you want a specific piece of jewelry to go to a certain grandchild. However, you then lose that piece of jewelry before you pass away. A separate schedule makes it easier to update specific gifts without having to amend the entire will.
Who will be your power of attorney for property?
Your Attorney for Property will manage your financial affairs in the event of incapacity. Typically, spouses name each other as primary appointees, followed by alternates.
When it comes to choosing co-attorneys, you have the option to decide whether they should act jointly or jointly and separately.
Jointly: If you choose to have your co-attorneys act jointly, they must make decisions together and reach a consensus. This approach ensures that all major financial decisions require the agreement of both co-attorneys, which can provide an added layer of security and oversight.
Jointly and separately: If you opt for joint and separate authority, your co-attorneys can make decisions together, but they can also act independently when necessary. This approach balances joint decision-making and the flexibility for each co-attorney to manage specific financial aspects without needing the other’s approval for every transaction.
You also need to specify when their power of attorney will come into effect. You can decide whether it should take effect immediately upon signing or only upon your incapacity.
If you grant them immediate authority, they can begin managing your financial affairs as soon as the document is executed. This means avoiding any delay involved with determining that you are incapable of managing your affairs. However, it also means that they can make decisions without your direct involvement, which may not be suitable for everyone.
Who will be your power of attorney for personal care?
Your Attorney for Personal Care is responsible for making medical and healthcare decisions on your behalf if you become unable to do so. Typically, spouses choose each other as primary appointees, followed by alternates. Again, if you appoint co-attorneys, decide whether they should work jointly or jointly and separately.
In addition to these decisions, there are other factors to consider.
You should clearly state your organ donor status within this document to ensure your preferences regarding organ donation are respected.
Furthermore, you may want to consider whether your appointee should receive compensation for their role, as serving as an Attorney for Personal Care can be a demanding responsibility.
Lastly, suppose you hold specific religious or cultural beliefs that are important to you with respect to medical treatment and end-of-life care. In that case, it is essential to include them in your document. This will help guarantee that your healthcare choices align with your personal values, providing assurance and preserving the integrity of your healthcare decisions.
What are your burial wishes?
Finally, consider your burial wishes. This may include decisions about cremation, burial, or even specific details such as the choice of cemetery. If you have pre-planned your funeral, provide these details to ensure your wishes are carried out.
Regularly update your estate plan.
Life is constantly evolving, and so should your estate plan. Major life events such as marriage, divorce, the birth of children or grandchildren, changes in financial situations, and even changes in tax laws can all have a significant impact on your estate planning needs. By revisiting and updating your estate plan periodically, you can make necessary adjustments, address any new concerns, and guarantee that your loved ones are well-protected and that your assets are distributed as you intend.
Consulting with an experienced estate planning attorney, as well as receiving accounting or similar professional advice can help you navigate these changes and ensure that your estate plan remains a reflection of your current wishes and goals.
Get started on your estate plan today!
Our estate planning checklist is just the beginning of creating your estate plan . When it comes to the complex legal aspects of planning your estate, Beeksma Law is your trusted and experienced partner. We primarily focus on estate law and with our estate litigation experience, we have the unique ability to craft legal documents that not only reflect your intentions but also minimize potential liabilities.
By reaching out to Beeksma Law, you can be confident that we will handle your estate planning needs with professionalism and expertise, protecting your assets and legacy for future generations.
Disclaimer: This article on estate planning in Ontario is intended for the purposes of providing information only and is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
It has been said that estate planning is a gift to those you love, and we wholeheartedly agree. We know that no one wants to think about the end of our lives. However, we cannot overstate the importance of having these conversations and making these plans.
Too often, we have seen the pain and grief of a loss compounded by the stress and overwhelm of poor estate planning.
Planning for the end of your life means taking into consideration your unique circumstances. Our lives are all different, and the plans for our estates must reflect that.
This article outlines, at a very high level, how different factors influence your estate planning. Of course, we would be happy to speak further about your situation. You can book a consultation here for more information on estate planning in Ontario.
Estate Planning in Ontario: An Overview
Estate planning in Ontario is governed primarily by the Succession Law Reform Act (“SLRA”). Its last major update was in the 1970s; however, further changes have received Royal Assent, with some key amendments expected to become law in January 2022. We will discuss those changes in detail in a future article.
Estate Planning in Ontario: Your Relationships
Congratulations! You got married – we wish you many happy years together.
However, under Ontario’s current legislation, if you had a will before you got married, then your entire will has now been revoked unless you made it with marriage in mind. What does that mean for you? Your will may have had provisions protecting your children or donating to causes that you’re passionate about, but these are no longer valid.
If you recently got married or will be married shortly, it is worthwhile to look at your will. Fortunately, this is one of the changes being made to the SLRA. As of January 2022, marriage will not revoke a will, aligning Ontario with many other provinces.
In a common-law relationship
While you may have been with your partner longer than most married couples, Ontario’s legislation does not grant the same rights to common-law partners. Suppose you die intestate [definition: a person who died without having made a will]. Your common-law partner does not have a claim to your estate unless one of the following claims are filed: filing a dependency claim or filing a claim for unjust enrichment, both of which involve litigation (i.e. a lawsuit).
Of course, this is an unnecessary strain and expense. It is much more prudent and practical to have a will in place that recognizes your partner and provides for them in the event of your death.
As the SLRA currently stands, a separated spouse still stands to inherit a portion of the deceased spouse’s estate. That means that your home could automatically pass to your estranged spouse, instead of to your children or even a new common-law partner.
However, as of January 2022, those portions of the SLRA will be amended. The legislation defines situations that deem a couple to be separated. In those instances, a surviving spouse would be treated the same as if the couple was divorced.
Estate Planning in Ontario: Your Children
One key reason to have estate planning in place is to protect your minor children. Therefore, selecting a guardian is an important decision and one that should be given careful thought.
Generally speaking, a surviving parent would gain full custody of minor children. However, if there is no surviving parent, then other family members need to apply to the courts to gain custody. This could cause strife amongst your family if there are multiple claims and disagreements about who should be your children’s guardians.
You will also want to consider who will have guardianship over your estate’s assets. Children cannot inherit an estate, so a person will need to be appointed to care for those assets until the children reach the age of majority. That may, or may not, be the same person who has physical custody of the children.
Your children may be older, so their needs may be different. You will not have to think about a guardian; however, there are still decisions that you must make.
While an adult is legally defined as 18-years old, is that the age that you want your child to inherit your estate? Many parents consider their children’s maturity level and put a graduated trust in place. This means that a portion of the estate is released at certain points. It is a wise move that protects your child from the poor decisions of their young adulthood.
Are your children married? Would you want their spouses to inherit a portion of your estate, or should it pass on to any grandchildren? These are questions that must be asked and answered.
The traditional two-parent family is becoming increasingly less common, and complex “stepfamilies” are on the rise. If this is true for you, this needs to be reflected in your estate planning.
For example, you may have a child from a previous relationship. You get married but then pass away, and your will leaves your estate to your spouse (your child’s step-parent). The step-parent passes, but that estate is left to a new spouse or their children. Your child is not protected.
Another example, you and your spouse both have children from previous relationships. You both have wills in place that leave everything to each other and then are divided amongst all the children. You pass, and your relationship between your children and spouse sours. The step-parent amends their will so that their children, and not yours, inherit their estate. Again, your children are not protected.
While we hate to think about such horrible scenarios, it is a disservice to our children if we do not protect them after we are gone.
While you may consider your pet as part of your family, they are property in the eyes of estate legislation. Therefore, if you would like to plan for your pet’s care if you pass, it will have to be laid out specifically in your will.
Be Kind – Plan Ahead
We know that you love your family and want to do what’s best for them. Therefore, give them the gift of estate planning so that their loss does not have to include dealing with lengthy legal matters.
Our firm helps individuals match their estate planning to their lives. If you want to revisit your estate planning, please reach out to us here [link]. Our team would be more than happy to speak with you.