Written by Kelley Keehn
Friday, February 21st, 2020
In our incredibly fast-paced world, it can be extremely tough to slow down and plan for the future.
It's even harder to think about a time when you won't be around. But you owe it to your loved ones to ensure that your final wishes are known and properly documented. If they're not, your hard earned money may not be distributed the way you'd like, or more tax could be paid than necessary.
The Importance of a Will
The next big issue when thinking about your final wishes is how you'll draft that document up, which is called your will. And this step is where many people stall.
“There are two main reasons people delay getting their wills done: the decisions involved, and the costs involved," says Jason Heath, fee-only Certified Financial Planner with Objective Financial Partners Inc.
"Someone may need to make decisions about who to name as their executor (the person who fulfills the wishes of your will) or who they would want to be guardian of their minor children. These selections are not always obvious. There may also be complexities like second marriages and children from previous marriages, or unique assets like family businesses or cottages. It can be difficult for people to make decisions about important estate wishes, even with the help of a professional."
When Do You Need a Will?
What if you're just starting out in life, don't have investments yet or have lots of debt? Karen Platten, Q.C., Partner and Estate Lawyer with McLennan Ross LLP says, “while individuals do not think that they have assets, if they have insurance on debt, for example, the debt could be covered and then the asset becomes an asset of the estate."
You may also want to draft or update your will when you have a child or tie the knot. Platten says, “It's important to name a guardian, and a will is an obvious place to do so. Additionally, if you don't set up a trust for your child/children, they will receive the funds at 18, which is generally not what a parent wants. Getting married can be a touch point if you want someone other than your spouse to receive some of your assets."
Will on Your Own or with a Lawyer?
You've probably seen kits advertised on TV or on social media that can be used to create your own will. For a cost that's less than a dinner out, you can tackle this sticky estate planning issue. But are low-cost will kits a good idea?
Platten doesn't think so. “They cannot ask all of the appropriate questions or give you appropriate advice where your circumstances are even slightly out of the ordinary, such as where you have a grandchild that you are required to provide for. In most circumstances, they simply do not cover enough situations."
Can You Write Your Own Will?
“Yes, you can do a holographic (handwritten) will," advises Platten. “But it must conform to the requirement of the particular Act in your province. Some provinces do not allow holographic wills, so you would need to confirm that you can do so in your province. In Alberta, for example, a will can be valid if written totally in your handwriting and signed by you at the end."
The Bigger Picture
An estate lawyer will walk you through some equally important conversations and documents that a website simply can't. Like drafting a Power of Attorney (if something happens to you while you're alive) or your personal directives (how you'd like your health care handled).
Some things in life should be decided quickly, and getting them delivered the next day is a welcome convenience. Others deserve a step back for planning and careful consideration. Take the time to consider your final wishes and make sure they're documented prudently, updated regularly and stored in the right place.