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 The
Money Management Newsletter: Taxes
and Estate Matters
What you need to know about Estate Planning
and More…
Part 5: The financial aspects of your estate plan
Compiled by David Newman
Money Management Newsletter, August 2005
Anyone who has ever been the Executor of someone's estate knows
how time-consuming it can be to locate important documents, certificates,
lists of advisors and other items. It is in the best interest of your
family that your Executor be able to act quickly to protect and safeguard
your assets. To assist your Executor with this task, a comprehensive estate
plan should include a complete record of your financial affairs.
How Do I Begin?
List your assets and liabilities. Your ASSETS include:
- Real estate - land, house(s), cottage(s) and condominium(s).
- Personal effects - furnishings, clothing, antiques, jewellery,
cars, fine art, etc.
- Investments - cash, bank accounts, securities, mutual funds,
Canada Savings Bonds, GICs, partnerships
- Other Property - life insurance policies, joint annuities,
RRSPs. RRIFs and pensions
- Joint Property - Life insurance, jointly held property, and
survivor benefits of pension and other retirement plans will pass by
contract or operation of law upon your death. Review your jointly held
property and update the beneficiaries named in your insurance policies
and retirement plans. It is important to list how your various assets
are registered (i.e., sole ownership, joint tenants or tenants-in-common)
and also list the beneficiaries of your life insurance policies and
retirement plans, etc. There are two ways of owning property with one
or more persons. One is as "joint tenants;" the other is as
"tenants-in-common." The distinction between the two becomes
very important at death. In the case of joint tenants, the deceased's
interest automatically goes to the survivor without forming part of
their estate. In the case of tenants-in-common, the deceased's interest
in the property forms part of their estate and is passed on to his or
her beneficiaries. This applies not only to real estate but also to
bank accounts, GICs, investment portfolios, etc. Registering property
as "joint tenants" is a useful way of avoiding the estate
process, as the property automatically goes to the survivor. This helps
reduce probate fees and estate administration costs.
Your LIABILITIES include: Mortgages, loans, credit cards, investment-related
debts and other personal obligations.
To determine the value of your estate, subtract your liabilities (what
you owe) from your assets (what you own). Remember that not all of your
property passes under your Will.
By having all this information available, your Executor will be better
able to fulfill his or her duties and manage your affairs. If you do not
have a Will, or if your Will has not been updated recently, perhaps it
is time to meet with a lawyer and get the job done.
Fiscalagents.com Site-links:
Being an executor
- What are your responsibilities and obligations?: Being named as
an executor of an estate is a big undertaking requiring a considerable
amount of time and knowledge. You have been entrusted to handle the financial
affairs of the deceased in their absence and owe it to them to make sure
you know what is required of you.
The Cornerstone ®
Household Directory of Documents: Have you ever taken the time to
think about the sheer volume of information you are required to remember?
From bank account numbers to dates of special occasions to insurance policy
numbers, we take it for granted that this information is there, ready
to be easily recalled whenever needed.
Who will your family turn to when you die? It's a little known fact: that
for some, the third most expensive purchase most Canadians will make,
after their houses and their cars, is their funeral.
Editors Notes: These articles
are only covering some of the areas that need examination when drawing
up an estate plan. If you do not have a Will, or if your Will has not
been updated recently, perhaps it is time to meet with a lawyer and get
the job done. Special thanks to (NC) and Ontario March of Dimes
Getting Advice: We believe that a "Will" requires careful planning
to ensure all essential matters are covered. It should also be reviewed
periodically and discussed with a qualified adviser or team of advisers
to incorporate any changes in your personal circumstances.
Notice: Fiscal Agents Financial Services Group are not engaged in rendering
tax, accounting or legal professional services or advice. The comments
in this newsletter are not intended, nor should they be relied upon, to
replace specific professional advice. Before acting on material contained
herein. Readers should seek advice that is appropriate to their personal
circumstances from a professional advisor.
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©
, Fiscal Agents Money Management Newsletter
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