As Canadians, we take pride in planning for the future and taking care of our loved ones. Yet when it comes to estate planning, a lot of us hesitate. And we get it. It’s a topic that can feel overwhelming, emotional, and even a bit uncomfortable. But here's the truth: estate planning isn't just for the wealthy or the elderly. It's an important step for anyone who wants to protect their legacy and ensure their wishes are respected.

At Prospr by Sun Life, we believe that financial empowerment starts with knowledge. That's why we're here to guide you through the essentials of estate planning, demystify the process, and help you take control of your financial future.

Life changes, and so should your estate plan 

Think about how much your life has changed in the past few years. Maybe you've bought a home, welcomed a child into your family, or even moved to a new province. Each of these milestones is a great opportunity to review and update your estate plan. Here are some key life events that should trigger a review:

1. Purchasing property
2. Moving to another province
3. Having or adopting children or grandchildren
4. Experiencing major changes in finances or tax laws
5. Changes in marital status

Remember, your estate plan is a living document that should grow and evolve with you. By keeping it current, you're ensuring that your wishes will be honoured, no matter what life brings.

What are common mistakes in estate planning? 

Even with the best intentions, estate planning can go awry. Here are some common issues we see and how you can avoid them:

1. Dying without a will (we call this “intestate”): If this happens, it can lead to lengthy legal battles and your assets being distributed in ways you never intended. The solution? Create a valid will as soon as possible.
2. Thinking a will is enough in estate planning: A will is one piece of the puzzle but it doesn't cover everything. A full estate plan also considers trusts, insurance, final wishes, and legal documents that protect you and your loved ones.
3. Choosing an unsuitable executor: Your executor has a big job ahead of them. Choose someone you trust, and who’s organized and up to the task.
4. Failing to coordinate legal documents: Ensure all your estate planning documents work together. This includes your will, beneficiary designations, and any trusts you've established.
5. Underestimating the emotional impact on your heirs: Family dynamics can be complex. Consider how your decisions might impact your loved ones emotionally, not just financially.
6. Poor communication with family: Open, honest conversations with your family about your estate plans can prevent misunderstandings and real conflicts down the road.
7. Forgetting to update beneficiaries on insurance policies, segregated fund contracts, and registered plans (RRSPs, TFSAs, etc.) These designations can override your will - so inconsistency can lead to disputes or things not going as you’d planned. 

What are the most important decisions in estate planning? 

Estate planning doesn't have to be complicated. Here are some key tools that can help you create a robust plan:

1. A well-drafted Will: This is the foundation of your estate plan. It outlines how you want your assets distributed, who you trust to manage the process. Here are 6 important things to think about when drafting your will. 
2. Trusts: These can be useful for managing assets for beneficiaries who may not be ready to inherit directly, such as minor children or those with special needs.
3. Segregated fund contracts: These investment products can offer unique estate planning benefits, including the ability to bypass probate and avoid the associated time and costs.
4. Careful beneficiary designations: Regularly review and update the beneficiaries on your registered accounts (like RRSPs and TFSAs) and insurance policies.
5. Funeral or final wishes (where appropriate): Preferences for funeral arrangements or memorial services can help prevent confusion and reduce emotional stress for your family and loved ones. 

“A Will, on its own, doesn’t constitute an Estate plan.” - Dan Price, Director Advanced Planning, Sun Life Global Investments

Talking to your family about your estate planning and inheritance goals

We know it's not easy to talk about what happens after you're gone. But having these conversations with your loved ones is one of the most caring things you can do. Here are some tips to make the process smoother:

1. Plan ahead: Identify potential sensitive topics - like dividing assets in blended families or estranged relationships -  and think about how you'll address them.
2. Choose the right time and place: Pick a neutral location where everyone feels comfortable.
3. Be open and honest: Explain your decisions clearly and be willing to listen to concerns.
4. Stay calm: Keep emotions in check and focus on the facts in front of you.
5. Follow up: After the discussion, send a summary to ensure everyone is on the same page.

“If the family meeting is handled properly, a lot of good things can come from it” - Dan Price, Director Advanced Planning, Sun Life Global Investments

Start building your financial future today

Estate planning is an act of love. It's about protecting the people and causes you care about most. Here are some steps you can take today to get started:

1. Take inventory of your assets and liabilities.
2. Think about your goals and wishes for your estate.
3. Research estate laws in your province.
4. Start drafting a will or update your existing one.
5. Review your beneficiary designations on all accounts and policies.

So what’s next?

Remember, you don't have to do this alone. We’re here to help. A Prospr advisor can help you navigate the complexities of estate planning, help you make informed decisions, and give you peace of mind knowing your legacy is secure. 

Book an appointment. Your financial future is too important to leave to chance. Take control today and start building an estate plan that reflects your values and protects your loved ones.

This article is meant to provide general information only. Sun Life Assurance Company of Canada does not provide legal, accounting, taxation, or other professional advice. Please seek advice from a qualified professional, including a thorough examination of your specific legal, accounting and tax situation.

Source: https://www.prosprsunlife.ca/en/insights/estate-planning-gone-awry/

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