Practical Financial Solutions: Five reasons to discuss your estate plan now
By Roger Higgins
Some things are difficult to talk about with family – and death tops that list.
The reluctance is understandable but now is the time to have a conversation about death and money with your loved ones – it’s the best way to iron out estate planning issues, reduce potential inheritance hostilities and a possible reduction in estate assets.
Here are the top five reasons to discuss your estate plan with your loved ones now:
1. Eliminate surprises: If your estate isn’t left in the manner your beneficiaries expect, the results can be resentment and even litigation. So, if you’re planning to do anything out of the ordinary, now is the time to provide your reasons.
2. Ask about special requests: You might assume you know which assets are important to each child but your guesses could be wrong. For example, the child you assumed wants the cottage may not be interested all. Now is the time to ask your beneficiaries about their special requests.
3. Manage expectations: For example, you have appointed only one of your two children as Executor. The child you have not appointed may feel that the appointed sibling somehow influenced you to give them more power over the estate. You may have a good reason for doing so – perhaps because the non-appointed child is a non-resident of Canada. Now is the time to provide your reasons.
4. Introduce your advisors: Your family may not know the professionals who know the history behind your estate plan, the location of your will and assets, and other important information. Now is the time to introduce your beneficiaries to your lawyer, accountant and/or financial advisor.
5. Explain unequal divisions: You may have decided that one child should receive less of your estate because they have already received money from you (perhaps for a house or car or to start a business) or to give specific assets to specific children that are of unequal value, which can lead to resentment. That’s why now is the time to discuss any unequal divisions, the reasons for them, and potential solutions such as one child purchasing sufficient insurance on your life to “buy out” a large asset from their sibling(s) with the insurance proceeds.
This column is sponsored by Roger Higgins, a BA, CFP Division Director for Investors Group in the Kootenays. For all your financial planning needs, contact Roger at 250-352-7777 of email at roger.higgins@investorsgroup.com
