The following is a list of steps you can take to ensure that your estate is in order in case something should happen to you:
Make sure rsp’s/rif’s and pensions have a beneficiary named (RSP’s/Rif’s can be rolled over to spouse on a tax-free basis and most pensions will continue to pay a pension to the surviving spouse often at about 70% of the amount the pensioner was receiving but this will vary from pension to pension)
Ensure there is a will, many people simply assume everything will go to the surviving spouse but depending on the size of the estate this may not be the case, as intestacy legislation in Ontario merely gives the surviving spouse a preferential share and a share of the remaining estate. Also, a person that dies intestate (without a will) won’t have an executor and a court will need to assign one which can cause long delays.
Make sure the will is up to date (i.e. if leaving something to the children or grandchildren that the youngest children/grandchildren have been added to the will so they aren’t left out.) Also, make sure that any assets that are to go to a specific beneficiary are included in the will. (Houses that are owned jointly with right of survivorship and life insurance usually bypass probate and pay directly to the beneficiary and are not always listed in the will)
In the event that life insurance policies are mentioned in the will ensure that the beneficiary of the policy in the will matches the beneficiary of the policy that the life insurance company has on record or this can cause huge issues for the estate.
Ensure that the witnesses to the will are not named as beneficiaries or spouse of a beneficiary.
Ensure that the executor of the will is willing and able to act as the executor and that they have a copy of the will or can at least easily access the will. (a safety deposit box can be a really bad place to store a will as once the owner of the box dies it can require a court order in order to open it.)
Locate all life insurance policies and ensure that a beneficiary is named. If the physical policy has been lost a claim can still be made however knowing which company the policy is with and the policy number is very useful. If no beneficiary is named then the policy will pay to the estate, but you generally want to avoid this as life insurance paid to a beneficiary is protected from creditors (both the creditors of the life insured and the beneficiary, this protection from the creditors can be continued after the beneficiary receives the funds as long as the funds aren’t commingled with other assets (Basically this means you should keep the life insurance proceeds in a separate bank account, incidentally this can also prevent the life insurance proceeds from becoming a marital asset in the event of a divorce)
Life insurance policies can include group life insurance from an employer (retired people can also sometimes have group life insurance), creditor insurance (this can include mortgage life insurance, or life insurance on any loan including rsp loans and car loans) The actual beneficiary on creditor life insurance is actually the lender, but the family/estate of the life insured benefit as the loan is discharged (up to the amount insured).
Try and gather all of your important documents in one place. This can include property deeds, insurance policies, stocks and bonds, investment statements for mutual funds, will, Powers of attorney, living wills, pension information, benefits booklets (from an employer), mortgage statements, contracts, contact information for lawyers, financial advisors, accountants, funeral homes, spiritual advisor etc. Let your executor know the location of these documents, ideally, these should be stored in a fireproof and waterproof box/safe. A safety deposit box may not be a good place to store a will as it can take a court order to have it opened when the person renting the box dies.
Consider writing a living will. This can give your spouse or power of attorney for medical care direction under what conditions you would not want to be resuscitated or you would want to be removed from life support.
Consider pre-planning your funeral, while I rarely think it is advisable to prepay you can make important decisions in advance such as if you prefer burial versus cremation. What do you want on your headstone, what information should the obituary contain. Which cemetery and funeral home would you prefer to use, how much you want to spend on a coffin, who should be notified in the event of your death? (often when these decisions are made while family members are grieving they spend far more on the funeral than the deceased would have wanted)
Please note that none of this constitutes legal advice. It is advisable to consult with a lawyer that specialises in estate law to ensure that your will is legally sound and that it will achieve your objectives.
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