One day it will be the end of the road. Your relatives, friends, colleagues, and neighbors will only remember you for your deeds and attitude. It is how most people look at things in their bid to understand life. Estate planning is a process you can delay but must not avoid.
This blog tries to enhance your understanding and addresses three common fears of estate planning in Canada.
What Is the Trend in Canada?
The Canadians are aging. Yes, in 2012, almost one in seven Canadians were elderly. However, economists estimate that by 2030, one in every four Canadians will be elderly.
We relate estate planning to aging. When we grow old and accumulate wealth, that is when we often think of doing estate planning.
A recent survey states that 55% of the Canadian population has a will. Of this, over 92% are 65 and older. For young Canadians, making a will is too daunting and challenging. There are several fears associated with estate planning mentioned.
Three Most Common Fears
It might be the leading decision of your life when you must decide how you will distribute your wealth. There are several associated fears.
1. Fear of Financial Burden
Estate planning is expensive! Yes, that is true. Several expenses like probate, Legal, accounting, executors, and Court fees could suddenly make the entire state planning process quite burdensome and costly.
It is the biggest fear that deters most Canadians from doing estate planning. They feel they will be required to pay several thousand dollars.
We cannot change the legal process but will certainly help you with your expense reduction.
|S. No.||How to Reduce Expenses?||Explanation|
|1.||Avoiding Probate Fees||The value of your probate fees depends upon the value of your estate. You can reduce your estate value in the following manner: If you own the life insurance policies, name the beneficiaries Hold your assets as cash or bearer certificates Save and accumulate money in registered savings plans, such as RRSP (Registered Retirement Savings Plan), RRIF (Registered Retirement Income Fund), TFSA (Tax-Free Savings Account), TFSA (Tax-Free Savings Account) Hold the assets in joint ownership While you are alive, you can gift your property You can set up a “trust fund” and become its “trustee.” Transfer some of your assets to this trust. You can create dual wills.|
|2.||Engage in Persuasive Negotiation||Estate planning is a legal process, and you will be required to meet your lawyer and accountant While most professionals charge a fixed fee, there is always scope for negotiation. Hence, engage in persuasive negotiation with your professionals and try to get the best deal.|
|3.||Replace the Existing Professionals||You hired a team of professionals for estate planning. You are getting better offers from other teams. In such a case, never ignore those offers and make a careful evaluation. If you are getting similar services at a comparatively affordable rate, there is no harm in replacing your team of existing professionals.|
2. Fear of Disagreement and Discord
Philips Cowan is a senior folk. He is married and has three children, Lucas, Sophia, and Maria. While Sophia and Lucas are well-settled and well-to-do, Maria does not earn much and depends on her father.
While planning the estate, Philips assigned 70% of his assets to Maria. He divided the remaining 30% equally between Lucas and Sophia.
Philips may have been right in planning his estate, as he wanted to balance and equalize all his children. But this did not go very well with Lucas and Sophia. Both wanted one-third share and presently maintain an estranged relationship with their father.
It is common. Yes, each of your beneficiaries expects you to give them a fair share of your estate. Nobody believes in balancing out or respects any of the circumstances.
It leads to the development of uncordial relationships and is often the reason for fights and mental disturbances that can rob you of your peace of mind.
3. Fear of Will Becoming a Public Document
What you earned belongs to your descendants with whom you want to share your wealth. However, after probating the will, it becomes a public document, and any public member can get a copy of it and study it.
It augments the chances of getting challenged by fraudsters, con artists, and even lawyers who want to gain unjustly.
A challenge will remain in the court for years, and the eligible beneficiaries are usually in for a long delay. The real estate value deteriorates, leading to monetary losses.