Many Canadians don’t have a signed or up-to-date Will – are you one of them? Without a Will, the fate of your children, your spouse and your estate could rest in the hands of a family member you don’t favour – or worse – a state official.
In the absence of you appointing an Administrator for your estate, the Court will choose one. If no one accepts the responsibility, the Public Trustee will assume that role and make important decisions on your behalf. This means your estate could be settled based on the Administrator/Public Trustee’s decisions – not yours. And, your estate will be charged fees for this, thereby decreasing the wealth distributed to your family. It gets messier.
Without a Will, you give up the right to appoint a guardian of your choosing to any young children you have. The Court may decide who raises your children. Furthermore, your common-law spouse or a same-sex partner may not be recognized in the distribution of your estate – as is the case in many provinces. Or, if you are in the process of getting divorced and are in a new common-law relationship, unintended consequences for beneficiaries may result.
The financial implications of dying without a Will are far reaching. You’ll lose opportunities for tax planning and strategic planning. As a result, the tax savings and other valuable benefits of testamentary trusts would not be available. A testamentary trust allows you to manage money or property for the benefit of your heirs. Failing to provide this could lead to unfavourable consequences, such as giving children a significant sum of money at an age when they are too young to manage it wisely.
Other possible scenarios are:
- The court process may cause delays settling your affairs, leaving your beneficiaries unable to pay bills.
- Your estate could have to pay income tax on the forced sale of the family home, cottage or business.
- Not deciding who gets what can cost thousands of dollars in legal bills, and may trigger bitter and potentially lasting family disputes.
Don’t leave it to chance. Plan ahead for the future of your loved ones by deciding now which gifts or money you want to leave to family members, friends or charities.
Ready to take control? Contact us for a free financial mapping session with an accredited consultant.