Many people think of estate planning as death planning, and that pessimistic view can make it very difficult to sink the necessary time and energy into creating a personalized estate plan that helps secure your legacy, protects your assets, and safeguards your family’s future. But at MacMillan Estate Planning, we understand that estate planning is actually life planning. It’s about evaluating what and who is most important to you right now, so that you can continue to provide for them now and later.
Create an Estate Plan Now. The younger you are and the better your health, the less likely anyone will be able to suggest you didn’t write your will in sound mind or that you wrote it under duress. After all, if a will sits 5 years until it’s used, it’s hard to argue that the writer didn’t have time to amend something if they wished. More importantly, if you write a will when you’re young, you’ll actually have one when you need it. Many Canadians simply don’t have any will at all, and that can lead to a lot of family conflict upon their passing.
Explain Unequal Treatment. You love your family, but that doesn’t mean your relationship to each of your children is identical. Perhaps one of your children has become your trusted confident and a leader in your business while your other child is pursuing a life of arts and travel but always has stories of crazy mishaps that make you laugh. Obviously, these children are going to be treated differently by you and your estate. So when you leave your business to your partner and an estate abroad and your vast art collection to the traveler, it just makes sense to you. But unfortunately, while grieving your death, emotions can run high and someone may feel like they were forgotten or neglected or otherwise underappreciated. Leaving a letter to each of your children explaining what you’ve left them and why can help to calm tempers and remind each child of the special relationship you shared with them.
Address Division of Personal Effects. It’s easy to split a bank account, it’s much harder to decide who gets your antiques and who gets your coin collection and who gets you first edition Dickens. Do you give each beneficiary part of the collection? Do you give the collection to the beneficiary who shows the most interest? At MacMillan Estate Planning, we specialize in helping families to have tough conversations over who will inherit jewelry, prized cars, or even pets. One of our clients who had an extensive antique collection wanted to ensure that every family member got the pieces that held the most sentimental value to them, so we threw a family barbecue with a mock, silent auction, and each family member was given an equal amount of monopoly money to bid on the pieces that mattered the most to them. Our client loved knowing that each piece of her collection would find a home with the heir that cherished it the most.
Address Loans, Gifts, & Advances. House prices are extremely high in many Canadian cities. Studying abroad can cost hundreds of thousand of dollars. Extravagant weddings that include the entire family, numerous friends, and business partners can also quickly reach into the hundreds of thousands of dollars. Often times, parents step in to offer their children loans, gifts, or advances to help them cover the costs. But while the gift, loan, or advance is wonderfully generous, it’s important to address this money in your estate plan. Is any remaining debt forgiven when you die? Or is their inheritance reduced by the owing amount? If you have an only child, these questions will probably be easier to answer than if you have two or more children. If only one of your children has already paid back their loans, they may feel that their sibling is getting to double dip.
Update Your Estate Plan! The most important piece of advice we can give you is to update your estate plan regularly! Every time a new child is born into your family, every time a relationship dynamic changes, every time you acquire a new, large asset, you need to be updating your estate plan. Regardless of whether you think a lot has changed, we suggest reevaluating your estate plan every 2-3 years while your children are young and every 5 years once they’re older. Many big changes happen slowly, so you may be surprised by how much has changed when looking at a will written as recently as 2 years ago.
Here at MacMillan Estate Planning, we understand that estate planning is life planning and lives change! It’s important to begin planning your estate young and to update it regularly. Contact MacMillan Estate Planning today to get started with your free consultation.