Perspective – Estate Process Part 5 : Preparing the Next Generation

Perspective – Estate Process Part 5 : Preparing the Next Generation

Estate Process – Part #5

This may be the most important objective as you establish an estate process!

Preparing the next generation.

You have spent a lifetime providing for your family and your retirement financial needs.  To just dump your hard-earned assets after you and your spouse no longer need them without sufficient direction does seem a little simple.  What if you could help to ensure that your assets would continue in the values and principles that had guided you in life?  It would be comforting to know that your family and beneficiaries respected the financial responsibility you have entrusted to them.  Preparing the next generation is something that should start now or as early as 6 or 8 years old.  It is an activity in which you should take leadership as you develop your Estate process.  Here are a couple of brief points to consider.

  1. Parents are the primary teachers of money and money management.
  2. The best legacy is to pass along the values before passing along the money!
  3. Family values, generosity and money management skills are transferrable.
  4. More is caught than taught!
  5. Children learn to manage money by managing money. It can have generational impact!
  6. Recognize that your family & beneficiaries are unique individuals each maybe requiring different treatment, yet you love them the same.
  7. How best can you help them flourish, mature and grow in their life and with their family?

Family Involvement.

In most cases, if you have family, they will be involved in the execution of your Will and estate.  So many times after a person passes away, there are questions and a significant level of surprise as family and beneficiaries learn for the first time what estate objectives have been established and who has responsibilities.  At that point there is no opportunity to clarify any reasoning with the deceased.

In light of keeping the next generation prepared it is good to plan and host a family meeting.  Once your estate process is reviewed and set with counsel from your legal, tax and financial advisors, it is good to ensure that all family members know of your general plans and who has responsibilities as your Executors and Power of Attorneys.  During this family time you can share your heart for the settlement of your estate and any desired actions for your Power of Attorneys.  You can remind your loved ones of the life skills and financial management you have taught by your example.  Your family will gain a level of confidence if a portion of this meeting can be arranged with your legal or professional counsel present to explain the general plans you have made and answer any questions.  It is important that if some family members cannot attend due to distance that they be able to attend via the conferencing or virtual platforms available today.

You can prevent a ‘scavenger hunt’ by showing your executors where all the details are kept and making sure that required documents and contacts are in one place.  These files should be reviewed regularly and at least every few years to ensure that there are no required changes or additions.  Once your family have an initial understanding of your estate process, any future changes are easily communicated.


This series of articles are not exhaustive by any means.  Yet their purpose is to provide a strong encouragement  for you to prioritize your estate and POA preparations and get things in order.  Not only will it give you a significant sense of peace, it will save your loved ones from a lot of additional grief when help is needed most.  There is no better time than right now.  Make the call to the professionals who can assist you with your estate process!  They have the resources to help you get started.

Perspective – Estate Process Part 4 : Practical Steps

Perspective – Estate Process Part 4 : Practical Steps

Estate Process – Part #4

As the Estate process continues, consider some of these practical steps that may help achieve a desired & efficient transfer of estate assets.


Some good, cost-effective estate planning can be achieved through the following opportunities. The key here is to determine the most appropriate and tax efficient distribution of your assets to provide for the care of those you leave behind.

1. Establishing appropriate named beneficiaries

Naming beneficiaries on products such as life insurance, RRSPs, Pensions and TFSAs will take those assets out of your estate and in most cases transfer them directly to your beneficiaries.  It is important to note that any tax obligations remain the responsibility of the estate.  It is also important to ensure that your named beneficiaries are consistent with and in the same percentages as desired or directed in your Will.  For some estates it may be best to distribute all assets through the direction of the Will.

2. Consider the spousal roll over provisions

CRA provides for a spousal roll-over provision that will defer tax obligations for the surviving spouse.  This means that on the death of the first spouse, there would be minimal tax burden on transferred assets. A significant tax burden could restrict the survivor’s ability to manage life financially.

3. Setting up joint ownership of some assets

Establishing joint ownership of some assets (either with survivorship or as joint tenants) can allow for an efficient transfer of ownership at death.  Some or all of these assets will generally not form part of an estate.  Transferring ownership of property (i.e. real estate, equity investments) may cause a taxable disposition or future tax obligation.  It is important to seek good counsel on these decisions.

4. Possibilities of trusts

Some of the tax advantages of trusts have been reduced in recent years.  A trust can be established while you are alive or set up as instructed in your will.  There can be trusts for disabled dependents, families and for charitable wishes.  Trusts can take different forms and are generally fairly complex demanding annual filings and reporting by trustees.  Again, good counsel is required.


Life Insurance policies can be your estate’s best friend.  Death benefits are tax free and can be paid directly to your estate or beneficiaries.  There are a variety of insurance policies and each have advantages for the right circumstance.  Consider the advantage of a tax free death benefit to your estate or beneficiaries.  You may want to consider how your life insurance policies can provide increased benefits through available dividend options.  Some estates will have an unavoidable tax obligation at death, and life insurance benefits can provide the means by which your estate will not be eroded by these taxes.  In other words, make sure your life insurance is working as best as possible for you.  Good advice from an insurance professional is important.


Many people have had a special interest in their church and in specific charities throughout life.  These charities can provide your estate with interesting and tax effective options that in turn provide you with the comfort of knowing that you are able to include a lasting legacy and contribution as part of your estate.  Charitable donations can counter a portion of the potential tax obligations calculated on your terminal tax return.  There are a number of provisions allowed by CRA for estates to direct funds or assets to registered charities and reduce tax obligations (i.e. donating securities).  Most of us would rather support a charity of our interest and choice then to have more taxes paid.

Next time, our final article in this series, yet maybe one of significant importance!

Perspective – Estate Process Part 3 : Estate Issues & Action List

Perspective – Estate Process Part 3 : Estate Issues & Action List

Estate Process – Part #3

In this third part of the series on the Estate Process we will start to outline some specific areas everyone should consider before it is too late. This series is meant to be a general explanation of estate issues and help you to generate an action list. Each person needs to seek council for their unique situations.

1. Having an up-to-date Will document, designed to accommodate your specific wishes, is extremely important. If you don’t have your own Will, you may be interested to know that the Government has one prepared for you, but it might not be considerate of your wishes. You can actually have more than one Will to direct your estate. For instance, if you have ownership in a business or corporation, you might want a Will appointing someone with more specialized skills to help your estate deal with those assets. Your personal assets would be directed according to your personal Will by the executors you have chosen for that part of your estate.
2. You will also want to ensure that you have your two Powers of Attorney in place; a power of attorney for property and a power of attorney for personal care. Many legal offices will help build the Will and POAs for both you and your spouse at a package price.
3. Be sure that your chosen executors know where to find your estate information when needed and ensure their understanding of any special instructions.
4. Your estate documents should be reviewed at least every 5 to 7 years or if there is a material change in your life.
5. Keep it simple…uncomplicated is good!

There is nothing morbid about having your funeral and burial plans arranged. Having your burial plot purchased and a marker erected is being well prepared. As a final expression of love to your family It would be comforting for them to know of your wishes for your memorial service and for those who might be involved. You can use life insurance or assigned assets to provide for these ‘final’ costs. Or consider setting up a plan through your funeral home to prepay your funeral costs. The more decisions you have made before hand, the easier it is for your loved ones who just want to know what you desire for these arrangements.

Estate Lawyers, Estate and Tax Accountants along with Financial and Investment Planners are professionals who will assist you to plan and ensure that your Will is executable and your estate assets distributed in the most tax efficient and appropriate manner. Let them help you establish a process that is best. They will also be available to your family for advice and assistance when it is needed most. It is imperative that your estate trustees and family know how to contact these professionals for their help.

In the fourth part of our series on estates there will be more practical and specific steps you can take.

Perspective – Estate Process Part 2 : Estate Preparations

Perspective – Estate Process Part 2 : Estate Preparations

Estate Process – Part #2

Further to the last Perspective, this is the second in the series on Estate Planning issues everyone needs to prepare for.  Since the beginning of time, living beings have come to the end of life.  Because no one will avoid this event, it is prudent to be prepared and to instruct those left behind.  In this article, let’s think about a few other perspectives that may help in estate preparations.


As much as a person may want to maximize the benefits after death for their family, handing over significant amounts of assets to beneficiaries may not be a good thing for them.  In most cases your estate is the result of your hard work and that effort is often not understood or appreciated.  Case in point is the call received from a lawyer’s office several years ago requesting that a particular estate liquidation be expedited much faster since one of the beneficiaries had purchased a new Mercedes and needed their estate funds to pay for it.  The deceased person had scrimped and saved through life to be able to provide value for their family.  In most cases, you cannot ensure responsible use of your hard-earned funds by your family.  Be assured that with many families there would be no problem.  Yet money inherited easily can change people who are not prepared.  Some beneficiaries may benefit from a trust that puts certain restrictions on the use of funds or at least controls income and the distribution of assets over a certain time period.


Many people, when planning for their estate affairs and the care of their loved ones, fail to consider that the grieving process may put serious limits on their family’s ability to make good and appropriate choices.  People who are grieving are often vulnerable and may make decisions that they later wish to reverse.  It is important to ensure appropriate counsel from trusted family, friends and advisors who will have your family’s best interests at heart and a clearer head to help navigate through required decisions.


The cost of authenticating a Will and authorizing trustees through the provincial courts is one of those estate requirements that may not be avoidable.  It is commonly referred to as the Probate fees.  Minimizing this tax is good.  However, sometimes an attempt to reduce probate can create unexpected tax or estate costs.  One example would be the potential tax implications if a principal residence is re-registered to joint ownership with family other then your spouse.  Should the new joint owner already own property, a portion of your principal residence may lose its tax advantage.  Changing the ownership of some investments would be another example that may create a deemed disposition triggering a taxable capital gain not anticipated.  Additionally, trying to avoid probate may lead to an inequitable distribution of your estate.  Any assets with joint ownership or a named beneficiary are not typically included in an estate value for distribution.  Surviving joint owners & beneficiaries would legally receive assets outside of your estate and then may also participate in the distribution of assets as directed by your Will.  Some beneficiaries could receive benefits that all beneficiaries were to share equally.

You need good professional advice on the most appropriate distribution and tax effective transfer of assets to your beneficiaries.  It might be better to pay a little and save more.

Perspective – Estate Process Part 1 : Estate Planning Process

Perspective – Estate Process Part 1 : Estate Planning Process

Estate Process – Part #1

If there ever was a topic that most want to avoid…it is the planning process for the settlement of your estate. The reason for the neglect could be because of the following realities: ”I will die!”, “I will take nothing with me!”, “I will probably die at a time I did not anticipate!”, “Someone else will get my ‘stuff’!” Since the beginning of time, it has always been the same. How could it be different now? Yet the way we deal with these realities can be one final act of stewardship and expression of love to those we care about. A person can only decide before they die who gets their ‘stuff’ after death. The end of life is appointed and is similar to an exam. If you study now and prepare, it always helps you finish well.

That is actually the first important point. It needs to be understood that wealth transfer is not an event…it is a process. The estate planning process should start now. Completing the process will bring a heightened sense of peace and confidence in knowing that your family will be looked after while at the same time ensuring your final wishes will be provided for. Just ask those who have already prepared.

The estate process is not only the transfer of your assets and belongings. A well planned estate will take into consideration the impact it will have on beneficiaries. Beneficiaries should never be surprised by the decisions of a benefactor. These decisions will be consistent with the way they lived their life and the priorities that guided their financial decisions.

And take some time to consider these questions. Are the next stewards prepared to responsibly manage what is left to them? Are your heirs, (Spouse, Children or Grandchildren) in a position to understand what would be an effective use of an inheritance that could continue the heritage you have left? Are they trained in the values and priorities that have guided you and that could continue a positive impact on the world they remain in?

Do they have an understanding of or know where to get good counsel on tax & estate laws and investment principles & strategies?

An estate process should not attempt to manipulate behaviour or change lifestyle. Neither should it be controlled by the demands or expectations of beneficiaries. It should help heirs rather than harm them financially. Even though some beneficiaries may need some guidance and protection, trying to establish control ‘from the grave’ may not be advantageous in all relationships.

R.G. LeTourneau once stated that “rather than leave our wealth to our children, we’d rather leave our children to the world.”

One day, all will leave ‘stuff’ to someone else. Doesn’t it make sense to be the one to choose who those “someones” are and be a part of helping them be ready to receive it? A well-prepared plan will relieve stress and give you comfort.

This 5 part series will provide perspectives to strongly encourage you to prioritize an essential process of effective wealth transfer which will, when completed, bring you peace of mind! After that…live!