Key Estate Planning Questions to Ask Yourself

Do You Know What Estate Planning Questions to Ask?

  • Estate planning is organizing a tax-efficient transfer of your assets to family members, specific people or charities.
  • Your estate plan will determine who should receive assets, and when proceeds of your estate should be distributed.
  • Plus any other financial or contractual obligations.
  • If you own a business, your estate plan could also plan for the orderly succession of your business.
  • The estate plan allows for Post Mortem planning and tax minimization strategies.
  • Your estate plan should be integrated with your financial, retirement and business plans. If you own property or assets in another province or country, consideration should be given to reflect different laws and taxation that will apply.
  • Your estate plan will need to be reviewed over time as your personal and business circumstances change. Your plan should be kept as current and up to date as possible in order that it remains relevant.

What other Estate Planning Questions Should I think About?

  • Your estate plan is based on your rational and emotional motivations. It is done out of care, concern, and generosity towards your family.  It can be a method of providing meaning to the material wealth that a successful career has provided.  It can also enhance opportunities for family or employees who will continue to benefit from years of accomplishment in your family business.

If you answer yes to any of the following estate planning questions, your plan will give you comfort knowing your affairs and family members are taken care of.

What are you concerned about?

  • Avoiding conflict, uncertainty, or possible litigation regarding your estate?
  • Making sure that your estate has adequate funds to pay taxes that will arise on your death?
  • Minimizing taxes in order that your beneficiary receives a larger share?
  • Paying any creditors at the time of death?

What would you want to do?

  • Know that your estate will be distributed according to your wishes?
  • Minimize stress to family members by looking after your affairs in advance?
  • Provide security for your employees?
  • Continue supporting charitable works that are important to you?
  • Ensure you have adequate funding to pay any tax arising from your death?

Estate & Succession Planning

Your estate plan includes all of your business and personal assets.  A succession plan will only deal with your business assets.  An estate plan is set in motion upon your death.  A succession plan may take effect upon retirement or the sale of your business.

As a business owner, it is prudent to plan an exit strategy or a succession plan that will provide for the transfer of your business upon death, disability or retirement.  Your succession plan should include:

  • A management transition for your business
  • An ownership transition for your business
  • A contingency plan in the event of a disability or untimely death.
  • Anticipated retirement from your business.

Is Your Estate Plan up to Date?

Wills & Power of Attorney:

  • Do you have a Will?
  • Do you have an Enduring Power of Attorney?
  • Do you have a Personal Directive?
  • If you have property in another province/country have you considered a Will in that jurisdiction?

Financial Planning:

  • Have you determined the income needs of family members dependent on you?
  • Have you considered steps to implement post-mortem planning for income splitting?

Business Planning:

  • Do you have a Shareholders or Buy Sell Agreement in place?
  • Is your Buy Sell Agreement funded with Life and Critical Illness Insurance?
  • Does your Estate Plan address creditor issues?
  • Do you have a contingency plan in the event you are disabled or die before transferring your ownership interest?
  • Have you selected a successor or established a process for selecting a succession for your business?
  • Do you have a written plan for the transfer of your business?
  • If a family member will be taking over your business, have you made arrangements to treat other family members equally?

Advanced Planning:

  • Have you identified whether the status of your operating or holding company shares are eligible for the lifetime capital gains exemption?
  • Have you considered transferring the future growth of your business to someone else?
  • Have you considered the use of a capital gains rollover to your spouse, deferring taxes payable on your death?
  • Have you investigated any tax liability your estate will have to pay?
  • Will your estate have enough cash to pay any tax liabilities?
  • Have you investigated strategies to reduce probate fees on the value of your estate?
  • Have you planned for any charitable gifting using your estate?
  • Have any agreements that form part of your estate plan been reviewed in the last year?
  • Have you shared details of your estate plan with family members?
  • Does your family know the location of your Will, Life Insurance and other important documents relating to your estate plan?
  • Is your family aware of funeral and organ donation wishes?

Consider Life Insurance:

Insurance coverage can form an important cornerstone in any planning during your life time and upon death.  Life Insurance guarantees tax free capital at the time it is most needed.

  • Protect your business against loss caused by death of key employees or yourself (ask us about key person insurance).
  • Use Life Insurance to fund your shareholders agreement.
  • Life Insurance can be used to create or equalize a legacy for family members.
  • Life Insurance can be used to cover capital gains taxes upon your death.
  • Use of joint last to die insurance coverage is one of the most cost-effective ways to pay capital gains or estate taxes.
  • Life Insurance can be used to fund charitable giving by designating the charity as a beneficiary of a policy on your life.

Do you still have estate planning questions? For information or for estate planning advice, please call us at 587-405-3463 or send us an Email.

Find more information on this topic on the Government of Canada page entitled, Estate Planning Wills & Dealing with Death.

Two generations talking about estate planning.

How to Talk About Estate Planning

Is Estate Planning the Elephant in the Room for Canadian Families?

Recent studies show that most Canadians are uncomfortable with talking about estate planning, finances and wills with their parents, families, and even professionals:

  • 47% of Canadians have never brought up the subject of inheritance with the people they want to leave money to
  • 79% have not consulted a financial advisor about the tax implications of wealth left behind


What You Need to Know When Talking About Estate Planning

The importance of wills and estate planning cannot be understated and there are several essential reasons why Canadians need to get over their awkwardness talking about estate planning with their families and with a professional Estate Planner.

For instance, do you know how to:

  • Allocate different types of assets to different people, depending on their relation to you?
  • Use Tax Free Savings Accounts as a tax shelter?
  • Appropriately use Trusts to avoid awkwardness and distrust among siblings?
  • Use Charitable Giving to enjoy tax benefits?

Once a professional estate planner has helped you with your estate planning and you are comfortable with your finalized will, it is equally as important to discuss these matters with family members and anyone else included in your will.

Talking about estate planning openly gives you an opportunity to explain to your heirs the reasons for why your will is set up the way it is, which can help prevent family legal disputes after your passing. You can also help your heirs understand the value of your inheritance in hopes they will be fiscally responsible with the inheritance they receive.

Estate Planning Tips

Here are a few simple tips on how talking about estate planning with your loved ones and heirs can help:

  • Talk often about smaller, less important matters so that everyone will become more comfortable with the topic.
  • Choose the right setting for your personal family dynamics, whether it is an impromptu casual setting or a formal discussion facilitated by your estate planner.
  • Communicate the contents of your will and estate plan in a group setting, with everyone present, stating your reasoning behind the way you have set up your will.
  • Use your own judgement in discerning how much information you should disclose to your heirs, depending on their maturity level and stage of life.
  • If you have a spouse, make sure you are on the same page, and you are both involved in the conversation.
  • Anticipate questions you think your children or heirs may have, and be prepared with well thought out answers.
  • Dream big and discuss your intended legacy with your heirs. While you can’t dictate what your children or heirs will do with the inheritance you have left them after you pass, you can work to instill common goals when it comes to spending, saving, and giving, in order to pass on a legacy through generations to come.
  • Be sure to ask the heir(s) how they feel and to air any concerns they may have. Give them a chance to be heard, even if you do not intend to change your will.
  • Make it clear that your will may be an ongoing discussion because a lot can change, especially if you are still young and healthy.

Still Have Questions About Wills and Estate Planning?

If you still feel you have unanswered questions about will preparation and estate planning and you need assistance please call our Edmonton office at 1-780-437-5070 to speak with one of our Executive Benefit Strategies advisors or use our online contact form to request a free Consultation.