The importance of a will and key documents for estate plan
By ATB Wealth 9 March 2020 3 min read
A survey of Albertans published in the May 2019 issue of ATB Investor Beat reported that only 35% of us actually have a will in place, with 51% saying they do not have a will, 11% saying that they are in the process of getting one or have a “partial” one, and 3% declined to answer. The top three reasons given for not having a will were; 31% “I don’t know where to start”, 29% “I don’t have enough to leave in a will”, and 24% “lack of knowledge / I am too young”.
While not always easy to talk about, your will is a critical part of your overall estate plan. To help you understand all of the aspects of estate planning, we have created a series of articles to guide you along the way. Let’s start with the importance of a will.
What is a will in a “comprehensive estate plan”?
For most people, a comprehensive estate plan will include three documents: a will, an Enduring Power of Attorney, and a Personal Directive. In a nutshell, a person’s Last Will and Testament deals with the disposition of their assets after they die, and may include the use of testamentary trusts for children or other beneficiaries.
What things should a “good” will contain?
Given that a will is your last chance to specify who gets what and how they get it, you need to be sure that your will contains the appropriate clauses, powers and directions to allow your executor to carry out your wishes. While a person will always have certain legal obligations to their spouse and other “family members” as defined by Alberta legislation, that legislation also provides you with considerable testamentary freedom. This freedom allows for considerable creativity in how you formulate your estate plans.
Your estate plan will ultimately be determined by the size and nature of the assets that end up comprising your “estate”, your distributions objectives as well as the particular characteristics of your estate beneficiaries. Having a well-thought-out and comprehensive will can go a long way towards ensuring that your last wishes are carried out as closely as possible to what you envisioned when you drew up your estate plan.
What if I don’t have will?
When you have no will, you are intestate and the distribution of your estate will be governed by the intestacy provisions of Alberta’s Wills and Succession Act. In such cases, you will have no say in how your estate is distributed, and an application will have to be made to the Court of Queen’s Bench to have an estate administrator (akin to an executor) appointed. The administrator will ultimately have to prove to the court that they have administered your estate in accordance with the legislation.
What about my executor?
This is a big job, and you will need to find some big shoulders! Whomever you appoint as your executor will have the obligation of ensuring your estate plans are properly implemented in a timely and accurate manner. Being an executor is a big and important job, and can be an honour for some, but it can last for quite a long time and requires someone you trust. It is no longer uncommon to see even straightforward estate administrations that include Probate take between two and three years to complete. As a result, considerable thought needs to be given on whom to appoint as executor with more complicated and long term estate administration requiring broad skill sets.
It is for these reasons that many people consider naming a corporate executor in some capacity. For a fee, a corporate executor will administer your estate as per your wishes outlined in your will. At ATB Wealth, our partner, Cidel Trust Company, which is headquartered in Calgary, provides corporate executor, trustee, and attorney services.
This document has been prepared by ATB Wealth. ATB Investment Management Inc., ATB Securities Inc. (Member Investment Industry Regulatory Organization of Canada and Canadian Investor Protection Fund) and ATB Insurance Advisors Inc. are wholly owned subsidiaries of ATB Financial and operate under the trade name ATB Wealth. ATB Financial is a registered trade name/trademark of Alberta Treasury Branches.
The information contained herein has been compiled or arrived at from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy or completeness and ATB Wealth (nor its component legal entities) does not undertake to provide updated information should a change occur. This document is being provided for information purposes only and is not intended to replace or serve as a substitute for professional advice, nor as an offer to sell or a solicitation of an offer to buy any investment. ATB Wealth, ATB Investment Management Inc., ATB Securities Inc. and ATB Insurance Advisors Inc. do not accept any liability or responsibility whatsoever for any loss arising from any use of this document or its contents. Always consult with your investment advisor before buying or selling securities. This document may not be reproduced in whole or in part, or referred to in any manner whatsoever, nor may the information, opinions and conclusions contained in it be referred to without the prior consent of ATB Wealth.
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