Simple 10-Step Estate Planning Checklist
The sooner you start, the simpler you will find estate planning! The longer you leave it, the more complex and the greater the chance you will miss out on regulatory and tax breaks. So, where do we start? By breaking down the process into simple bite-size bits.
Estate planning BC is simple in principle but can be pretty complex in practice, especially with no preparation. Essentially, you need to know your starting point, where you want to be, and the most efficient way to get there. Our estate planning checklist walks you through the process, prompts you to think about specific areas in isolation, and brings everything together at the end. Whether looking at online wills BC, trustees, beneficiaries or the ever-changing regulatory environment, there is much to consider.
1. Review Your Assets and Liabilities
The first stage of estate planning BC is to review your assets and liabilities, employment, investment and other sources of income. Even though many of us have an idea in our head as to what we are worth, liabilities and plans for the future, when written down on paper they may differ significantly. Therefore, every element of your financial life must be noted in this review. This ensures you can make plans for the efficient structure of your estate and gives you a starting point, a foundation going forward.
2. Appoint Financial Advisers
When you have a list of your assets, liabilities and income sources, this is the time to approach a professional financial adviser. They will sit down with you; look at your assets and liabilities in more detail and your hopes and aspirations for the future. While you will likely need some legal representation to complement your financial adviser, the degree of additional assistance will vary. If you have a relatively simple estate, it should be reasonably easy to keep the cost down when looking at estate planning BC.
Those with business interests and assets spread across Canada and the rest of the world may need specialist assistance. When it comes to business interests, there may already be pre-existing arrangements with directors/partners which need to be respected. In many ways, advice is the key in the early stages, as this will guide you in the appropriate direction.
3. Identify Your Goals
As we touched on above, if you don’t know where you wish to go, how will you know when you get there? Typically, people leave the vast array of their estate to family and close friends. Indeed there are rules and regulations regarding estates; if no will or instructions exist, assets will be shared out amongst spouses/partners, children and the wider family. So it is essential to recognise how you wish your assets to be shared at a relatively early stage.
Would you like your partner/spouse to receive everything and manage part on behalf of your children? If there are significant assets available, it may be an idea to set up a trust fund for your wider family. Do not automatically assume that those “left behind” are in synch with your thoughts. They may not know about your goals and wishes for your assets. You must leave no element of confusion!
4. Create an Estate Management Plan
The only way that estate management BC looks simple is because you have done the groundwork; you have started relatively early and taken it piece by piece. Now that you know your assets and goals for the future, it is time to establish a formal estate management plan. This will incorporate several individuals such as trustees, lawyers, financial advisers and beneficiaries. You may require additional assistance in some cases, such as a particularly complicated personal/business life.
The next stage of the estate planning checklist is to appoint the relevant people and build on the foundations with the legal paperwork.
5. Appoint trustees/executors
Whether we are talking about online wills BC or the more traditional written will, you must have trustees and executors in place. This prompts the question, what is the difference between a trustee and an executor? A trustee is in charge of managing the estate before it is passed to the beneficiaries. An executor is an individual/company appointed to carry out the deceased’s wishes. They will be involved in many activities, which can include any of the following:-
- Applying for probate
- Valuing the estate
- Settling inheritance tax
- Registering the death
- Arranging the funeral
- Closing relevant accounts
- Collating assets
- Distributing funds/assets
Many people are misguided and automatically assume that the executor and trustee have similar roles. This brings us to other questions, such as; can an executor be a beneficiary in British Columbia? While legally, there is no reason why not, from a moral/simplification point of view, the easiest thing to do is to appoint executors that are not beneficiaries.
6. Complete the Relevant Paperwork
Now that you have your team in place, your list of assets/liabilities and have begun taking formal advice, now is the time to complete the relevant paperwork. When we say “paperwork”, many will be aware that online wills BC are now recognised under the law and legally binding. Consequently, this section applies to both online and physical wills.
When it comes down to placing your instructions on paper, there is a growing trend toward excluding immediate friends and family from discussions. This allows the individual to remain focused on what they want, not being overly influenced by the hopes and aspirations of others. Unfortunately, even relatively quiet, unassuming people can turn into hard-nosed individuals if they feel they have been “wronged” in someone’s will. Therefore, you must add as much detail to your will as possible, leaving no room for different interpretations or legal wrangling.
Failure to create a watertight will can, and often has, resulted in legal action. This not only drags the individual’s family through the courts but can also lead to significant costs, which may be taken out of the estate. In this situation, nobody benefits.
7. Register Estate Documents
Even though there are numerous ways in which you can leave instructions after your death, many people still use the Canada Will Registry. This is a handy starting point for family and friends on your demise. The registration document will note executors and trustees, those allowed access, and details of how your estate should be split. While there is no legal requirement to register estate related documents prior to your death, if they are lost or destroyed, this can cause serious problems.
8. Store Estate Documents
There are numerous methods of storing estate documents to ensure they are to hand upon your death. These include:-
- Lawyers
- Banks
- Financial advisers
- Trusted parties
- Cloud services
It is also essential that out of date wills and estate related documents are correctly destroyed. Failure to do so will only cause confusion which could lead to more legal challenges and significant costs. In addition, you will make the situation much more transparent so that everyone knows where they stand.
In recent years we have seen the emergence of virtual storage facilities for legal documents. These services also ensure the timely release to trustees and executors. Due to a change in British Columbia regulations, it is now perfectly legal to store your will and last testament in the clouds. While slowly starting to be appreciated by the wider public, this is a significant development.
9. Adapt and Maximise Regulatory Changes
The idea that your estate planning checklist is a one-time visit, a one-off event, is a fallacy. As we have all seen, governments in British Columbia, across Canada and the globe are regularly changing financial regulations, including estate laws. While dependent upon the type of government, new rules may emerge which are beneficial, while others may increase the government’s tax take from your estate.
Whatever the situation, it is vital that you adapt your estate planning checklist to make the most of often complex regulatory changes. Your advisers should rubberstamp any significant adjustments to the structure of your estate.
10. Annual Review of Your Estate Planning
It is good housekeeping to review your finances and your estate planning checklist on an annual basis. Sometimes, you may require additional advice throughout the year, while other scenarios may require a simple box-ticking yearly meeting. However, you must sit down with your advisers regularly. It may be that your personal circumstances have changed, your finances have exceeded initial expectations, or there may be family issues.
An annual review ensures that there is regular communication between advisers and clients. It also allows all parties to discuss any issues at hand or potential challenges going forward. Do not underestimate the importance of an annual client meeting!
Fail to Prepare, Prepare to Fail
When looking at our estate planning checklist, everything appears simple, straightforward and obvious. This is the whole point of the checklist, breaking down a potentially complex task into more manageable bite-sized chunks. Focusing on specific issues instead of the broader picture encourages a high level of detail and greater understanding.
It is essential to have peace of mind while also exerting control of your assets before your death. This ensures that an estate that may have taken decades to build is directed at your preferred beneficiaries. By failing to prepare, you are preparing to fail; it is as simple as that!
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What is a Power of Attorney?
There is a lot of confusion on the need for Power of Attorney and equally important on the revocation of it. Generally, a need for establishing a Power of Attorney (PoA) is most necessary in case something were to happen to you. For example, if you have had an accident or illness that impacts your ability to make financial or healthcare decisions for yourself, you will need someone to make those decisions for you.
You should consider having a power of attorney, regardless of age or financial situation. You will always need that level of decision-making if you are not able to make it yourself, even if you don’t have a lot of assets.
A power of attorney is a legal document that gives someone you trust the right to make financial or health care decisions for you. This trusted person does not have to be a lawyer to be your attorney, it can be a family member, friend or a trusted professional of your choice.
Without an attorney for property, your family, including your spouse, cannot automatically step in to make financial decisions for you. They might have to go to court to become your court-appointed guardian. As a worst-case scenario, the government may have to make decisions for you, but only as a last resort.
There are two types of powers of attorney:
Personal care
An attorney for personal care can make decisions about your:
- health care
- housing
- other aspects of your personal life such as meals and clothing
If you do not have an attorney for personal care, your family can make some decisions, but not all.
Property
An attorney for property can make decisions about your financial affairs including:
- paying your bills
- collecting money owed to you
- maintaining or selling your house
- managing your investments
You should choose a person you trust to act as your attorney, such as a family member, spouse, or long-time friend. Some people choose a lawyer or trust company. Talk to the person or company before appointing them to make sure that they will take on this responsibility. Make sure they understand how you want your financial affairs or personal care handled.
You should never feel pressured to make someone your attorney. Speak to a lawyer about your options if you do not have anyone you are comfortable appointing.
You can make a power of attorney document yourself for free or have a lawyer do it. The Time Secured app provides a few editable templates that you can fill out and scan for safe keeping, including revocation of Power of Attorney if needed.
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Why Time Secured?
Imagine this, Shaun and Alice prepared a will that gives guardianship of their son Sam, to Alice’s brother Mike. Although they want to share the will with some of their other family members, they are worried that their guardianship wishes can cause some family friction or awkwardness, especially from the two sets of grandparents. They’re also worried that hard copies of the will might get lost or become outdated if other family members have different versions.
Then there is Kim, she wants to make sure her daughter Erin has her banking information but doesn’t want to give her that information just yet. She’s worried Erin might use it for a mini shopping spree! As a single mother, Kim constantly worries about how Erin can easily access her banking account if something were to suddenly happen to her if she goes into a coma or worse.
Jillian wants her online business email and social media accounts closed off if something serious were to happen to her, but she won’t give access to her sister Tonya just yet, especially since some of those accounts have confidential and financial information. She worries that her sister may not have her latest passwords because she changes them often for security reasons.
As the world becomes more digitized, sharing all sorts of documents online is becoming the norm. But there still isn’t an easy way to share important documents at a time of your choosing. Time Secured is the first app of its kind to fill that gap.
With the Time Secured app – you can easily create beneficiaries, assign them files and choose when they receive those files. You can share time-sensitive documents by setting the exact time and date they are sent. The Time Secured app makes time-based file sharing easy. It is available on both iOS and Android platforms and can be used for regular documents as well as larger multimedia files such as videos and audio files. You can try it for 1 month and see how it can work for you and it is easy to download on both iOS and Android platforms.
Right now, there are few options for storing important documents, and having them be accessible to others at a certain time. For example, after you write your last will, you can keep it with a lawyer or in a bank’s safety deposit box. But the fees are high, flexibility is limited, and if you decide to update the documents you may incur additional fees. Plus in the case of a deposit box, you will have to give access to someone else. Otherwise, a court order is required to access the box after you pass.
Other digital services allow you to store your files but do not solve the problem of providing access to the files at a time of your choosing. For example, Google Drive and Dropbox require a long and tedious process to get access to the files of a deceased person. Time Secured does this with little effort.
With Time secured there is one less worry by saving you the stress of wondering whether your loved ones will have the most up-to-date documents if you are not around. It will also save you from sharing sensitive information when you are not ready to do so. It is easy to set up, user-friendly, and fully customizable. You decide what is accessible, who gets access, and when.
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Sending your older kids milestone notes
Sending your kids day-to-day notes, like love notes or lunch box notes while they are young is always a special treat and definitely instills a sense of happiness and belonging at an early age. A bond through note writing is a strong one. However, often many forget the practice when their children get older. Writing milestone notes is even more necessary when your children start to face complicated events in their lives, and recognition or acknowledgment that you may have experienced the same will do wonders for their resilience. It is also a great way for them to know more about you and to see you as a 3-dimensional person rather than a specific lens of parent and child.
Whether you write them now and send them through the Time Secured Time Trigger vault option for later, or write them, as they get older, it does not matter. So long as the notes are written and shared for your growing children to treasure.
Here are only a few notes that you should consider writing to your older children, but there are plenty of other additional reasons to send them heartfelt thoughts through notes.
“Just Because” Note
As our children grow up, you may feel communication with your older children is becoming routine, regimented, and one-sided. So write a note praising your kids praising them or showing how proud you are of them for the littlest things they have done. You can add encouragement, and sometimes these notes can make all the difference in the world for their day or more.
College and Career Note
A note that acknowledges the most important things to instill in them as they were growing up. Before they leave the nest, with a list of traits or characteristics that you want them to take away with them as they face the next chapter of their lives. Here is where life advice can be wisdom well imparted. They can also keep those notes for their kids or loved ones in the future as a reflection of your relationship with them.
“Remember When” Note
However old the children are, they will always get a nice laugh or tear from specific memories that have touched you and them or taught them a valuable life lesson – whether they know it at the time or not. Reflection on the past also reinforces your shared bond and brings up stories and positive feelings that may have been forgotten over time.
“What You Should Know About Me” Note
You will be hard-pressed to meet someone who did not wonder what their parents felt or thought about particular things or events in life. Even if they don’t admit it. These notes are about you, but it gives your children anywhere from closure for traumatic events, to deep feelings you could not openly share with them. Notes make this easier by taking out the walls and preconceptions. These are valuable messages to your kids to not only teach them about the person you are, but inevitably also about the person they are as well or want to be. Anecdotes and analogies on what certain things mean to you make it all the more accessible and give them a new understanding of you. Whether they are shared while you are around as your kids are older and able to understand your perspective or later on in life when you are no longer around (both of which can be done through the Time Secured App easily); these notes are invaluable.
Any of these note types can be shared through scans or emails with multimedia add-ons easily using the Time Secured App. More importantly, the substance and content they entail will be appreciated by your growing children or any loved one for that matter – guaranteed!