Benjamin Franklin once claimed there are two things in life that are inevitable: death and taxes. In the case of those people who die without a will and proper estate planning, the adage can easily be altered to: death and more taxes.
The wise Benjamin Franklin also once said, “By failing to prepare, you are preparing to fail.” So allow me to help you complete a few simple steps to ensure that you are ready for the inevitable.
What you need to know
- Conduct a physical inventory – List all of your possessions of value, anything worth more than $100. Start in the basement and work your way up to the attic, don’t forget the garage and shed.
- Conduct a non-physical inventory - List all of your financial accounts; chequing, savings, investments, pensions, life insurance policies, homeowners, auto, disability and critical care insurance
- Inventory your debts – all credit cards and outstanding loans, lines of credit and include a copy of your credit report if you have one or can obtain one for free
- Update your beneficiaries – for the accounts you own like insurance and registered accounts (RRSP, RRIF, TFSA, etc) ensure that your beneficiaries are current
- Ensure that your will contains and specifically identifies the accounts with beneficiaries and that your account beneficiaries exactly match those named in your will.
- Update your will with your lawyer – As time passes, decisions and circumstances change, marriages end, new relationships emerge, asset values dramatically and relatively increase and decline, tax laws affect values to be transferred
- Update your Powers of Attorney – For both financial matters and for personal care, your POAs should be continuously current and always reflect your wishes
- Select an Executor for your Estate – Choose someone you trust to fulfill your wishes AND someone who is capable and available to execute your will. Patience, persistence, communication and financial acumen are just a few of the skills required in an Executor
- As you age simplify your finances – Collapse and consolidate accounts and assets held at multiple institutions with multiple Advisors eventually to a single, trusted provider
- Establish an annual reminder to review and update estate documentation
An improperly prepared Estate will have little or no effect on you but a huge impact on your family, heirs and Executors. Prepare them for your departure, hopefully a long, long time from now, by preparing and updating your will and Estate.
Contact me for some real-world strategies to ensure that your hard work and careful planning passes to those you care about with as much ease as possible.