Estate Planning

At REAL Legacy we understand the challenges and emotions involved in making decisions about your estate and preparing a will. We’re here to demystify and simplify the process of getting your affairs in order. Planning your estate gives you the opportunity to properly transfer your wealth and assets to the people, or even charities that mean the most to you, in the event of your passing. Your loved ones will be grateful you prevented the stress and expense of dealing with your final affairs. We appreciate the unique circumstances of each of our clients and work with you to ensure the maximum value of your estate is passed onto your loved ones.

Are you certain your estate plan will meet all of your needs? An estate plan that ensures all your wishes are carried out should have the following components:

1. Will
2. Power of Attorney
3. Personal Directive

What is a will?

A will is an essential legal document that gives you the power to state your wishes about how your property is to be distributed after your death. You get the opportunity to clearly identify the executor you want to handle the matters of your estate, the beneficiaries in the distribution of your wealth, and the guardian of any of your children who are minors at the time of your death.
What personal information is required in a will?

Providing the details of your personal and family information is important when making a will. Including the following details to ensure your will is as helpful as possible is also important:
• Details of your assets and liabilities, including type of ownership and value.
• The name each asset is listed under.
• Don’t forget bank accounts, residence and other properties, cash, insurance policies, stocks, and bonds. You want to be sure your loved ones don’t miss out on any assets you worked hard to earn.
• Be sure to list the names and contact information of anyone you wish to include as a beneficiary, fiduciary, guardian, or otherwise. This may include your spouse, children, grandchildren, any other relatives or even friends or charities.

Executor

Someone must be responsible for the settling of your estate. This person or institution is also referred to as an executor, trustee or personal representative. Deciding who to appoint as your executor is critical to ensuring that your wishes are properly executed. Therefore, careful consideration should be given to the executor’s age and background, to determine whether he or she is available, and capable enough to safeguard the assets and ensure the competent administration of your estate, along with any trust plans you may have arranged in your will. It is possible to appoint more than one executor. The executor will be responsible for collecting your assets, ensuring the payment of debts, determining whether your will needs to be probated, and distributing your assets to the beneficiaries as you requested.

Executor Fees

When considering whom to appoint as the executor of your will, keep in mind that the executor is entitled to “fair and reasonable allowance for (their) care, pains and trouble and (their) time expended in and about the (estate) that may be allowed by the Court…” If you’re concerned about burdening a family member or friend to be an executor, keep in mind that this fee provides them some flexibility, such as time off from work, to take care of your affairs. When you are planning your estate, it is a good idea to discuss the fees that will be paid to the executor to avoid any surprises. From time to time, situations may arise that may complicate the handling of the estate. This may create more work for the executor and the fees may increase. You may incorporate the fees you’ve agreed to in your will, whether it is a percentage of the estate, a specific amount agreed upon, or in the case of a trust company, based on a fee schedule. (adding a “then” is grammatically incorrect.)

RRSPs, RRIFs, TFSAs

There are some assets where you can directly name a beneficiary. Some examples include RRSPs-Registered Retirement Savings Plan, RRIFs-Registered Retirement Income Fund, and TFSAs-Tax -Free Savings Account (TFSA). You can designate a beneficiary to directly receive the proceeds from these assets outside of your will, upon your death. It is crucial that you make good choices in relation to these accounts. At REAL Legacy Law, we carefully review the process with you, and guide you in matters pertaining to beneficiaries and taxes.

Residue of Estate

What is left after all debts, taxes, legal expenses, other expenses related to estate administration are paid, and after any gifts of assets or bequests are distributed, is called the residue of the estate. In your will, you can give your residuary estate to more than one person. If you decide to do so, you must state how it is to be divided whether equal or otherwise. In a situation where no provision has been made for the distribution of the residue, the laws of intestacy will come into effect.

Funeral Arrangements and Organ Donations

What you want done in terms of funeral arrangements, e.g. cremation or burial, can be referred to in your will. In many instances, families may take some time before actually dealing with matters pertaining to your estate or may not even check the will before planning the funeral. Given this, you should inform the executor and your family members of your wishes. However, you should be aware that your requests are not binding on the executor. You can also include in your will your desire to have your organs or body parts donated.

Personal Effects and Household Goods

Your estate also includes your personal and household goods, which are to be distributed to the beneficiaries, as stated in the will. Reference can be made in the will to a list also called a Memorandum, which outlines how your personal possessions are to be distributed. If no specific instructions are included in the will, then the household goods are to be in the residue of the estate.

Minor Children

A very important aspect of planning your estate is determining who will take care of your children if they are minors at the time of your death. Who will make decisions for them? Who will look after their financial needs? If a trust is set up, who will manage it? These and a number of other vital questions should be answered and written into your will, instead of leaving such important issues to chance. When you are making the decision to find the person you feel is best suited to raise your children, you may want to give careful consideration to the person’s characteristics, personality, morals, values, competency, and how they raise and look after their own children. Be sure to talk with this person and find out what their thoughts are on taking on this responsibility.

Power of Attorney

A Power of Attorney or, Enduring Power of Attorney, is essential to a sound estate plan. It allows you to appoint one or more persons to act on your behalf if you become mentally incapacitated and cannot make decisions for yourself. Typically, people tend to choose a spouse, family member, or a friend they trust to perform the duties of their “attorney.” If you want to appoint more than one person, make certain that these individuals can work with each other with trust and respect. Much like choosing your executor, it is imperative that you select this person with care, looking for someone who has your best interests at heart, and, who is willing and capable to manage your finances. The person should be honest and trustworthy, and understand that they must use your assets only in your best interests at all times. The age of the person you are considering should also be taken into account, given the fact that the POA may be in effect for several years, and you would want the individual to be able to function in that capacity until your death. It is also recommended that you ask the person before appointing them, to ensure their willingness and availability to take on the responsibility.

The Enduring Power of Attorney can come into effect “immediately,” or only at the time when you are incapacitated which is called “the springing Power of Attorney.” The POA is prepared in a manner that reflects your wishes. If it says “with immediate effect” it means that the Power of Attorney is authorized to handle your financial matters even though you still have access to your assets. On the other hand, ‘the springing Power of Attorney” is only effective in the event that you become incapacitated and cannot handle your own affairs.

Even though being incapacitated is something that we prefer not to think about, the reality is that it could happen, and it could place our families in difficult and stressful situations when attempting to deal with financial matters that you handled when you were in good health. Without a POA, simple matters like paying utility bills, dealing with the mortgage, and even credit card payments can become quite complicated. Rather than going through the courts for a trustee, which can take a while, it is recommended that you include a Power of Attorney in your estate plan. Reviewing your Power of Attorney regularly is also critical to ensuring that it is still adequate to meet your needs, and that all appointees involved still have the ability and willingness to perform their duties.

Personal Directive

A personal directive is a legal document that states in detail what you want in terms of your care if you become mentally incapacitated and cannot make decisions for yourself. The personal directive is different to the Power of Attorney. The Power of Attorney addresses business and financial matters whereas the Personal Directive addresses personal matters and outlines what you want in your personal care. In addition, you can appoint an agent to make decisions about your medical care, where you will live and other aspects of your personal life.

A Personal Directive allows you to remain in control to some extent when you cannot speak for yourself. It saves you the stress of going through the court system and the possibility of having persons who you may not feel are well-suited to carry out your wishes being appointed to deal with them.

Legal Services for Estate Planning and Estate Administration

The process of planning your estate can appear intimidating, and it can be challenging to make decisions about an uncertain future. Reach out to Angela —-a qualified Wills and Estate Lawyer– who is an expert in this area. Her knowledge of the process and understanding of her client’s wishes will make planning your estate planning process much easier. If you want to find out more about putting your estate affairs in order, please contact Angela at angela@reallegacylaw.com or 403-258-4400.