What is estate planning?
Estate planning is the process of arranging for the disposal of a person’s assets during a person’s life. Good estate planning can eliminate uncertainties over the administration of an estate and can maximize the value of an estate by minimizing taxes and other expenses. Property can be transferred to beneficiaries outside of will (for example through a trust, joint ownership or in some cases as a named beneficiary) or through a will.
What is a will?
A will is a document that says what you want done with your property when you die. Wills deal with property that includes real estate, money, investments, and personal and household belongings that you own. A will can be changed at any time (so long as you have capacity to do so) and has has no legal effect until you die.
Why should you make a will?
If you are an adult who owns assets or has a spouse or young children, you should have a will. Despite the fact that a well drafted will can save surviving spouses, children, and other beneficiaries much time, effort, and money, many people do not have a will. If you die without having a will:
- the control you have over who gets how much of your estate and when, is lost;
- the right to appoint a guardian for any young children you have is forgone; and,
- the costs to administer your estate will be much higher.
What kinds of property are not dealt with in a will?
Any property that is owned jointly, is not generally covered by a will. For example, a joint bank account or a house owned in joint tenancy has a “right of survivorship.”, meaning that they automatically become the exclusive property of the joint survivor when you die. Also, a will does not apply to property like life insurance, RRSPs, RRIFs and TFSAs if they have named beneficiaries.
If you have minor children, appoint a guardian in your will
If you’re a parent or guardian of a minor child (under 19 years old), it is wise to appoint someone to be the child’s guardian in your will. In situations where parents are separated, it is best to agree on the choice of guardian should on or both parents die and to consider the parenting responsibilities that you have and to include them as part of the appointment of a guardian in your will. It is also wise to check with an older child (12 or older) about their own wishes before deciding on who to name in your will as a guardian. Courts will sometimes appoint a different guardian if it is in the child’s best interests. A trustee should also be appointed to manage a minor child’s inheritance. The executor can be the same person as the trustee
It’s important to make a will properly
A will is a binding legal document and should be prepared by an experienced professional as making an effective will requires a good understanding of property ownership rules and the law about wills. In order for a will to be valid, there are rules and formalities that must be followed, otherwise, the estate could be subject to disputes. Also, it is important that the will is clear and unambiguous with respect to the wishes of the testator – so wills should be worded carefully, or the estate could be subject to dispute. If the estate is disputed, there will be extra legal costs for the estate to get court orders to fix the problems, and that may not be entirely possible.
Your will can be changed after you die
If the will doesn’t properly provide for your spouse or children, they can sue under the Wills, Estates and Succession Act to have the will varied or changed by the BC Supreme Court. It is important to remember that a spouse includes both a married spouse and a person you have lived in a marriage-like relationship with for 2 years before your death and children include biological children who have not been given up for adoption as well as any children who have been formally adopted. As such, any decision to disinherit a child or spouse merits legal consultation before finalizing the will as the courts often change a will that is found to be unfair and does not discharge a person’s moral and legal obligation to provide for a spouse or child in a will.
You should hire a lawyer to help you
An experienced lawyer knows the rules that apply to wills and can help with estate planning to save money for your beneficiaries, giving you the peace of mind of knowing that your will is properly drafted and valid, and that your estate will be paid out as you wish. The fees charged by a lawyer reflect the time, skill and responsibility involved and will depend on how complex the situation is – our lawyers are happy to discuss the fees that will be charged when you call to arrange a meeting. Our lawyers are also happy to review or update your estate plans from time to time as needed should your circumstances change that merit changes to your will. Our lawyers may be reached at 250-888-0002 or via email at email@example.com.