You’ve thought about your estate plan. You know how you want your assets distributed after your death. Maybe you’ve even written a Last Will and Testament. So, what could go wrong? Here are a few key points to remember:
1. Formalities. To be valid, your will must be properly executed. It must be signed by you, in the presence of two witnesses, and signed by those two witnesses. You must have sufficient mental capacity to execute a valid will. Professional advice is always recommended in order to assist you in preparing your estate plan and to help ensure the formalities are properly met.
2. Joint Tenancies. The wishes you set out in your Last Will and Testament only apply to assets that are included as part of your “estate.” Assets held in joint tenancy generally do not form part of your estate. For example, you may hold your house in joint tenancy with your spouse. Upon your death, your interest in the house will be transferred to your spouse upon filing a document with the Land Title Office. Your house will not be distributed under your will. For another example, you may hold a bank account in joint tenancy with your child. A joint account will not form part of your estate, and your interest in the account will be transferred to the surviving joint tenant. Be sure to consider the impact of joint tenancy on your overall estate plan, to ensure your wishes are implemented.
3. Designated Beneficiaries. If you designate a beneficiary of certain assets, that asset will not form part of your estate, and will not pass under your Last Will and Testament. You can designate a beneficiary on a variety of assets, including TFSAs, RRSPs, RRIFs and some insurance plans.
4. Wills Variation Act. Be sure to consider whether you have made adequate provision for your spouse and children. In British Columbia, a spouse or child can apply to the court to change the distribution you have set out in your Last Will and Testament. The test is whether your Last Will and Testament makes adequate provision for the proper maintenance and support of the your spouse or children. If your will does not make such adequate and proper provision, then a court may order the provision that it thinks adequate, just and equitable in the circumstances, to be made out of your estate.
5. Review. Ensure your will is up-to-date and reflects your current situation and intentions. Have you recently married? Have you recently divorced? These life changes have serious impacts upon your Last Will and Testament.
Emily L. Clough is a lawyer practising in Vancouver.
NOVEMBER 2011 SENIOR LIVING MAGAZINE VANCOUVER & LOWER MAINLAND