Key estate planning documents
When putting together your estate plan, having the right documents in place will go a long way toward your intentions being followed.
Jamie Golombek and Debbie Pearl-Weinberg
Apr. 17, 2024
3-minute read
When putting together your estate plan, there are many issues to consider. Having the right documents in place will go a long way toward your intentions being followed. This report will review the importance of each of these documents, and what can happen without these documents in place.
A will addresses a number of key estate planning questions. Included is indicating out who will manage your estate, which is often referred to as the executor. You also set out who will inherit your property, and when the property will be distributed. You may be able to reduce taxes on your death by considering which of your beneficiaries is to receive specific property. If you have minor children, you should consider who you want to have custody, and spell these wishes out in your will.
If you die without a will, provincial law dictates who gets your assets upon death, which may not coincide with what you intended. Dying without a will can also mean needless complications to the estate administration process.
Power of attorney (POA) for property1
A power of attorney for property gives someone else the legal ability to deal with your financial affairs while you are alive. In the event that you become incapacitated without having signed a POA, your family or friends may need to apply to a court in order to deal with your financial affairs.
Power of attorney for personal care1
This power of attorney authorizes someone to make personal, health and medical decisions on your behalf in the event of your incapacity to make such decisions.
You can designate a beneficiary as part of the plan documents for your RRSP (Registered Retirement Savings Plan), RRIF (Registered Retirement Income Fund), TFSA (Tax-Free Savings Account) and life insurance policy2. You can also make a beneficiary designation for these plans in your will. The benefit of making beneficiary designations for these plans is that these assets will then pass to the designated beneficiaries outside of your estate, and thus, be outside of the provincial probate process.
It’s recommended that you review your will and other documents regularly, at least every 5 years. But if you experience any significant changes in your personal or financial circumstances, make sure to review it immediately.
1 The name of the document, the person making it and the person being granted authority varies by province or territory.
2 In Quebec, beneficiary designations are only permitted for insurance policies.
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