Estate Planning

The 5 Step Estate Plan

By Hull & Hull LLP

For something a little different on the blogging front, this week I will be providing a 5 part guide to developing your estate plan.  Today's blog will canvas preliminary issues to consider when creating (or revisiting) your estate plan.  What are the essential components of a sound estate plan and have you done everything possible to maximize your wealth preservation strategies, reduce the possibility of disputes and family strife, and avoid legal action pertaining to your estate down the road?  Every day this week I will provide a further glimpse into issues that arise as your estate plan evolves - from the initial conceptualization phase right through to requirements in Ontario for the valid execution of your documents.  Helpful tips and links will be provided along the way.

As a starting point, whether you are pondering your estate plan for the first time or simply re-thinking it (for example in light of the recent economic downturn), understanding the basic documents that govern wealth preservation for you and your heirs is critical.  While your Will is the foundation of your estate plan and provides for the orderly distribution of your assets upon your death, powers of attorney (both for property and personal care), living wills, and insurance all play a vital role in your estate plan as well.  Of course there are also many intangible factors in the planning process, such as underlying family dynamics.  Understanding the nature of sibling relationships and how these may play out after your death is therefore a critical component of your estate plan (see Jordan Atin's interesting blog on this issue here). 

As a first step, therefore, anyone thinking about this issue should understand the documents that comprise an effective plan and think about how their individual family dynamics may play a role.  Your estate planning lawyer can guide you in the proper direction in this regard and recommend how to deal with specific issues relating to your own individual family dynamics (for e.g. perhaps involving your beneficiaries in the creation of your estate plan in the appropriate situations, or suggesting trust arrangements rather than outright gifts to specific individuals).  Considering your choice of executor(s) and guardian of any minor children are also issues which your lawyer should canvas with you. 

Those documents which will be relied upon when you're "above the ground", such as powers of attorney and living wills (as opposed to your Will which comes into play when you're "below the ground") should be prepared and considered as essential components of your estate plan.

Tomorrow's blog examines a well-drafted Will and suggestions for preserving your wealth, reducing the possibility of disputes, and avoiding the potential for family strife upon your death.   

Sarah Hyndman Fitzpatrick    

Full post as published by Toronto Estate Law Blog on December 01, 2008 (boomark / email).