Estate Planning — Where to Begin

Many people avoid making a will and succession planning, not only because it is daunting to think about one’s own passing, but because it is a complex and time-consuming ordeal.

Below are a few ideas about how to begin your estate planning process if you are feeling stuck.

Review Your Life Insurance Needs

One often overlooked aspect of estate planning is life insurance. Many people avoid looking into it altogether from the outset. However, it can be difficult, or at least incredibly expensive, to take out life insurance once you find out that you have a serious or terminal illness.

While no one likes to incur additional expenses in life, term life insurance premiums are fairly modest, and an insurance plan can make all the difference to your loved ones comfort when you pass away. Your life insurance proceeds can assist with your funeral and the taxes that will be owed. Your life insurance proceeds can be particularly helpful if you have a mortgage on your home that your spouse would find difficult to pay with one income.

If you already have life insurance, check in with your insurance advisor annually to ensure that your information is up to date, and that you are taking all necessary steps to continue your coverage.

Keep Inventory of All Your Assets and Debts

When it comes to making a Will, one of the first things you should do is make a list of all your assets, including bank accounts, investments, real estate, and any tangible items (cars, furniture, artwork, etc.) of any significant value.

It is also import to keep a list of all your debts and liabilities. Accounting for these aspects in your Will may help prevent your estate trustee from distributing your assets before liabilities have been addressed. Although the executor should do his or her due diligence, thoroughly outlining any debts in your Will can take stress off for your executor and reduce the possibility of any errors being made in the administration of your estate.

Also make a list of any news or magazine subscriptions, utilities and ongoing payment obligations you have. While certain services will need to continue (e.g., home insurance, heat, hydro), you will want to ensure that your executor knows to immediately cancel any services that aren’t be used (e.g., phone, cable, internet) and has the information to do be able to do so. Closing accounts for any unnecessary expenses early will help minimize any losses from your estate.

Lastly, keep inventory of any creditors to the estate, so that the executor knows to account for any debts owing to the estate.

Think About Who You Want to Name as Beneficiaries to Your Will

Now that you have a clear picture of your financial situation, begin to think about who you want to name as beneficiaries in respect of each asset. For example, if you have three children whom you want to treat roughly equally, it is relatively easy to assign beneficiaries to assets such as registered plan investments by naming each as a 1/3 beneficiary. When it comes to tangible items, you may need to do a bit harder thinking regarding who you want to receive what.

Many people wish to name their living spouse as the primary beneficiary to most of their assets. However, you may wish to ensure that those assets are passed on to your children once your spouse passes on, rather than to a spouse’s new partner, for example. Ensuring that your Will reflects your wishes can be complex, from a legal standpoint. You should see an Etobicoke lawyer once you have begun to consider what your assets are and who you want to receive them upon your passing.

Think About Who You Want to Name to be in Charge of Your Estate

As you can see from the above tasks, the estate trustee is entrusted with a significant level of responsibility. It is his or her legal duty to ensure that the estate is administered in accordance with the terms of your will, that all assets and liabilities are accounted for, and seek any legal and accounting advice necessary. Importantly, it is your executor’s responsibility to ensure that this is done in a timely fashion.

While many testators name an adult child or another relative as the estate trustee in their Will, this is not the best decision in all cases. While it may be an honour for someone you love to be named as your legal representative, you must also choose someone who you believe is responsible, diligent, and will exercise reasonable judgment in seeking the help they need to administer the estate. Further, if you select a relative as an estate trustee, but there are poor relations among family members, disputes are more likely to arise. Sometimes, naming an impartial professional (e.g., a trust company, lawyer or accountant) for executor services is the wisest course of action.

Speak to an Estates Lawyer to Create Your Estate Plan

The above information should help you get your estate planning process started. However, drafting a Will that will be construed in accordance with your wishes can be more difficult than you think. it is important to see a lawyer to ensure that the terminology used in your Will adequately reflects your situation and your wishes, and to ensure that the document will be viewed as valid at law.

A lawyer will also help recommend other types of professionals whose advice you may want to seek — for example, investment advisors, tax specialists, and accountants. Your lawyer can work with these other professionals in order to ensure that your succession planning is as fruitful as possible, and to create a well-rounded plan that is most beneficial in your particular circumstances.

Call Martin Goose & Associates for a Wills and Estates Lawyer in Etobicoke

At our law firm in Etobicoke, our lawyers are experienced in estate planning and estate administration. Our Etobicoke lawyers are ready to assist you if you are ready to begin planning for the future. Contact us to set up your consultation at 416-239-4811.

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