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MONEY MATTERS
BEWARE ESTATE PLANNING NIGHTMARES
– By Brian Weatherdon , MA , CFP , CLU , CPCA , CRC
People are shy about discussing death – especially our own . We can be equally shy about planning ahead ( for death ). Many take an approach that worked for us ( or not ) as children . As a result , they may understand estate planning as children in the school yard understand anatomy . That worked , right ? But when it doesn ’ t , here are some of the twists that can beg for advanced planning in your family estate .
John and Mary wanted to give the same value to each of their children , near $ 500,000 each . Son Jeff was beneficiary of retirement savings accounts while their daughter Jane would inherit the house . When the parents passed on , Jeff claimed as beneficiary and soon received about $ 500,000 from the parents ’ RRIFs . Jane had a harder time though , because her parents ’ taxes ( on the RRIF ) came to $ 250,000 and the only asset to cover this bill was their house . Jane still doesn ’ t have title to the house , and Jeff still hasn ’ t given any money to help cover the tax bill . Nothing is more taxing that sibling conflict over a family estate !
When Joy passed away at 38 years young , no one knew where to locate her Will . Some day it may turn up , but the Court has already considered her intestate and appointed someone to administer the estate by laws that are likely quite different than what Joy would have wished .
Ted ’ s children met at the funeral home and had to decide what to do with his body . The Will ( 25 years old ) instructed burial and the oldest child was determined to honour this wish . However , Ted ’ s second wife had been cremated , and her urn was in a comfortable memorial chapel . Over some years , Ted mentioned wanting to be in an urn beside the wife in the chapel rather than outside in the ground . Sadly this pitted two children against the oldest , and angry words flowed among them at a time of great loss .
Would we consider how to avoid such tragic events among loved ones ? Lessons are simple , here are three : Ensure you have accredited and caring professionals reviewing your legal , personal , financial planning . Make sure trusted family members know where to find vital legal documents . And when your plans change , make certain to put these in writing as clear guidance to the loved ones who want to honour your wishes .
Don ’ t be shy about reaching for true counsel in all your financial and personal estate matters . Don ’ t let time-bombs mark your passing . A loving plan is a written plan , put together with professional care and updated at times to address changing needs and wishes .•
Brian Weatherdon of Sovereign Wealth Management Inc ., is a Certified Financial Advisor , retirement coach , and consultant on wealth and aging . 905-637-3500 brian @ sovereignwealth . ca
The information provided is general in nature , and should not be relied upon as a substitute for advice in any specific situation requiring appropriate legal , accounting , tax and other professional guidance . The views expressed are those of the author and not necessarily those of the issuer of any financial products for which the author may act as a distributor . Names and circumstances mentioned above are altered for confidentiality .
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