Key parts of an estate plan.
What will happen to my assets after I die? How do I ensure my loved ones receive exactly what I intend to leave behind for them? How do I minimize conflict when my property is distributed among my family members?
Estate planning provides solutions for the many questions you may have about distributing and managing your assets after your death, including situations when you’re alive but unable to care for yourself or make critical decisions about your life and money.
Making it a part of your ongoing financial planning, especially in consultation with a lawyer or a professional advisor, ensures your estate plan reflects your family situation and your assets and beneficiaries are taken care of when you’re unable to do it yourself.
Call 778-231-2118 or email estateplanning@vancity.com to connect with an advisor for impartial and effective advice and information for you to create or update your estate plan.
These are the four key parts of creating your estate plan:
Your will – the most important document.
There are many aspects of estate planning, but the most important is your will. Your will does two things. It outlines how your assets are to be managed and distributed to your beneficiaries after your death, and appoints an executor to ensure the distribution is done exactly per your wishes. In BC, a will has to be written in order to be valid.
And wills are not just for the wealthy. Everybody should have a will. If you die without a will (called dying intestate), specific legal rules will be used to decide how your assets are distributed. There is no flexibility. People you want to provide for may be left out. Need we say more?
Learn about wills, executors, and probate
Enduring power of attorney.
When you prepare your will, it is recommended that you also consider preparing an enduring power of attorney.
It is a legal document that lets you appoint somebody you trust, referred to as your attorney, to help you look after your money, property and legal affairs. This somebody can be one or more individual/s or a corporation. The authority of the attorney continues even if you become unable to make any decisions on your own. It allows your attorney, for example, to act for you if you become mentally or physically infirm.
An enduring power of attorney is easy to prepare and provides an inexpensive yet often practical solution for managing your financial affairs. However, it is limited to money-related matters and does not authorize the attorney to make medical, health care or personal care decisions. There’s something called a representation agreement for such decisions.
To make an enduring power of attorney, one must:
- Have the required legal mental capacity. If a person has a mental disability due to age, illness, or other causes that prevent legal capacity, a representation agreement can be used to appoint someone to assist with basic financial matters
- Be able to understand that a representative is being appointed to assist with making financial decisions
Representation agreements: financial & healthcare decision-making.
Wills speak for you after your death while these agreements speak for you while you are living.
Financial representation.
A Standard (section 7) representation agreement can be used for assigning someone to make simple decisions on your behalf when you have a modest or simple estate or no real property, or if you are not able to make an enduring power of attorney. For example, someone with dementia will be deemed to have limited legal mental capacity and therefore won’t be able to make the enduring power of attorney and will be required to make a representation agreement instead.
The representation agreement does not permit the representative to manage all financial matters but does allow for assistance with the usual day to day banking and bill paying as well as some other financial matters as set out by the Representation Agreement Act regulations.
Other times a representation agreement can be used are:
- When you have simple financial matters and no real estate or complex investments or require a simple document for less complex financial lives or
- For low-income families or individuals requiring a representative to be able to access assistance with basic financial management
Healthcare representation.
A representation agreement is also used to appoint a trusted family member or friend or a trusted individual, to make medical, health care and personal care decisions for you when you are unable to speak for yourself, like in case of accidents or medical emergencies. It’s also a way to make sure your wishes and values will be honoured if you’re incapacitated.
This is particularly important if you have specific wishes concerning specific medical treatments or medications. Based on the Representation Agreement Act in BC, your health care representative may be appointed under a standard (section 7) or an enhanced (section 9) representation agreement. The enhanced representation agreement gives the representative more wide-ranging authority to make decisions for you such as:
- Giving or refusing consent to healthcare or specific treatments (including life sustaining ones)
- Making arrangements for the care and education of your family members or children
- Moving into a care facility
- The decision to physical restrain, move or manage you
- Everyday decisions including what you eat, wear, do
For more information on representation agreements, contact the Nidus Personal Planning Resource Centre at info@nidus.ca.
Discretionary trust.
By creating a discretionary trust, you can hand over the distribution of your funds to family members at the discretion of a Trustee. This trustee cannot benefit from the funds and is appointed solely in the beneficiaries’ best interests and for maximum protection of the funds.
A trustee can also help provide for the future of a disabled child or family member. Like Vancity, Planned Lifetime Advocacy Network (PLAN) has also assisted many families who have special needs. PLAN is a registered non-profit charity that helps create a safe, secure and full life for a disabled relative by providing lifetime advocacy and monitoring.
Estate planning checklist.
Wondering where to begin your estate planning journey? Follow this simple guide for other aspects you should be thinking about in the process of creating your estate plan:
- Take an inventory of all assets to confirm which assets pass through the will and those that do not
- Designate beneficiaries for registered accounts and life insurance
- Choose an executor and alternate executor for will
- Choose a guardian for minor children
- Choose a trustee for minor children’s inheritance
- Choose the beneficiaries of the will and the distribution
- Choose a primary and alternate decision maker for financial management for enduring power of attorney
- Choose a decision maker for personal care and management for representation agreement
- Consider business succession planning if you own a business
Ready to create your estate plan?
Our Estates & Trusts Advisors can assist you with impartial and effective advice and information for you to create or update your estate plan. Meet with us by phone or online by booking an appointment.
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