Top 5 Estate Planning Mistakes

November 17, 2018

#1 Not having a will

Not having a will is akin to not having an estate plan. Studies show that most Canadian’s don’t have a will. Not having a will complicates the estate administration process and fails to account for certain estate planning strategies that could benefit an estate. Ultimately, making a will is about retaining a level of control over the future use of your assets, to ensure that personal and financial affairs are handled according to your wishes rather than the law, which is blind to individual circumstances.

#2 Not considering your own future

Estate planning is about providing for your loved ones and beneficiaries. It is also about taking care of yourself in case of incapacity or long-term disability. An unexpected crisis or health issue can have a significant impact on personal and financial affairs. A power of attorney document can consider who will take care of your children, pay your bills or make healthcare decisions on your behalf. Powers of attorney documents help people retain control of their financial, legal and healthcare decisions in the event they become incapacitated.

#3 Not updating your estate plan

Circumstances change, beneficiaries may be born, married, divorced; a trustee or power of attorney may have moved on or be unwilling to act; legislation changes and tax saving opportunities may emerge. It is important that estate planning documents accurately reflect personal circumstances and current law. Out-of-date estate planning documents increases the chance of litigation. Legitimate family members may need to fight for their entitlements if old estate planning documents are put forward as valid.   

#4 Assumptions

A good estate planning professional can analyze personal circumstances and discuss the potential tax, legal and practical implications involved. There are several assumptions people make that prove to be costly. People hope and assume that their children will all get along, stay married and stay sane. The specialized estate litigation area of law illustrates how assumptions made by a testator, whether by way of unclear wishes or the notion that children will figure it out later on, is a recipe that could land beneficiaries in lengthy legal battles.

Another assumption is that people assume it is an honour to be an estate trustee. Being an estate trustee is more like a duty and responsibility to be performed meticulously and diligently. Choosing an estate trustee is not easy. It requires someone who is honest, accountable and competent with numbers and getting things done.

When planning for your estate it is important not to take anything for granted. Start from the beginning and explore all eventualities with a competent professional.

#5 DIY Kits

With important documents it is risky to “do-it-yourself”. The legal criteria for a will to be valid are numerous and specific. Legal requirements need to be met in order for estate planning documents to be valid. Without the legal requirements being met, DIY kits may be found to be invalid.

Avoid Estate Planning mistakes

Whether young or old, single or married, and whatever tax bracket you belong to, your life and your assets should be protected and governed by the future that you dictate in your Will and Power of Attorney documents. Avoid the most common estate planning mistakes, preserve your wealth and provide for future generations and the charities your care about most.

Contact Charney Legal to discuss your estate planning needs.

 

The general information on this page is not applicable to any specific case and is intended for information purposes only. It is not a substitute for legal advice and may not be relied on as such. Readers are expressly advised to consult with a qualified lawyer for advice regarding their specific circumstances and entitlements under Ontario law.

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