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Estate planning checklist: Everything you need to think about

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Since the start of the pandemic we have noticed a much higher interest in estate planning, and understandably so. Physicians are seeing and dealing with more risks to themselves and their families, and thinking more seriously about their mortality.

Whether you are creating an estate plan for the first time or updating the one you already have in place, here’s a checklist to make sure you’ve got what you need.

1. Your will

Your will sets out how your assets are distributed and who is nominated to handle your affairs.  

a) Assets

  • Keep an up-to-date list of your significant assets; note the location if outside your province or outside Canada.
  • Are there any items you want to leave to a specific person?
  • Where possible, do you want assets to pass outside your estate to avoid probate fees (e.g., an insurance policy, an RRSP)? If so, do this via  beneficiary designation.

b) Beneficiaries

  • Who will inherit your assets?
  • If they are minors (or others whose ability to manage an inheritance causes you concern), do you have a trust or other provisions in place?
  • Is the list of beneficiaries in your will up to date? Have there been recent births, deaths or marriages in your family?
  • Have you included alternates in case your named beneficiaries predecease you?
  • Do you want to give to charities or other organizations?

c) Guardians (if you have minor children)

  • Have you spoken to your prospective guardian(s) to be sure they are willing?
  • Do they have the physical health and financial means (beyond what you will leave) to raise your child?
  • Did you include an alternate in case the guardian you chose is unable to commit?
  • Have you reviewed your choice of guardian as your child grows older?

d) Your executor1

Your executor administers your estate and carries out your wishes after you die. You can  name one  executor, or two or more co-executors. Be sure to name one or more alternates as well.

  • Is the executor capable of carrying out the responsibilities?
  • Do they have the time? Even a simple estate settlement can require as much as 250 hours of direct involvement.
  • Does this person live in the same city? Being an executor is a lot more costly, time-consuming and inconvenient if they have to travel.
  • Did you speak to your executor to be sure they are willing?
  • Does your executor know where to find your passwords and your important documents?
  • Will they be capable of dealing with your medical professional corporation?

2. Power of attorney2

A power of attorney is a legal document that appoints someone you trust to make decisions for you if you become unable to do so. This could be as a result of illness or an accident, or for any other reason. It can be temporary, due to illness or injury, or permanent. Power of attorney documents are typically created for you by a wills and estates lawyer (or notary in Quebec) as part of your estate plan.

  • Do you understand what it means to give someone power of attorney?
  • Did you name an alternate in case the person you chose is unable to serve?
  • Does the person you chose understand your wishes?
  • Does the person you chose know where you keep your passwords and important documents?
  • Do you want to specify a triggering event, such as a declaration of incapacity, for your power of attorney document to become effective?

3. Life insurance

Life insurance protects the financial security of your family and helps them maintain their lifestyle after you die. It can also help pay the taxes and other liabilities that will arise on your death.

  • Do you have life insurance? If so, is it adequate?
  • Are the beneficiaries you designated on these policies still the ones you would choose?

4. Funeral wishes

  • Do you have specific wishes for your funeral?
  • Do you want to be buried, cremated, or have your body donated to medical science?
  • Are you registered as an organ donor? Does your family know this?
  • Have you informed your family of your wishes? Don’t rely on your will since it may not be read until after your funeral.

5. Financial planning

  • Do you have an idea of what your tax bill will be at your death? What about probate fees?
  • Have you thought about how you can minimize some of those taxes?
  • Have you set aside enough money to pay for taxes, funeral costs and other expenses?
  • Do you have a succession plan for your medical practice?

6. Digital assets

From bank accounts to your Facebook page, your so-called “digital assets” will need to be dealt with when you die or if you become incapacitated.

  • Have you compiled a list of your digital assets, such as financial accounts, social media and email accounts, as well as data stored on computer hardware?
  • Have you specified how you want your social media accounts handled?
  • Have you told a few people (e.g., family members, your lawyer, your executor) where to find the key document containing your passwords?

To learn more about MD Financial Management’s estate and trust servicescontact an MD Advisor* and find out how we can help.

* MD Advisor refers to an MD Management Limited Financial Consultant or Investment Advisor (in Quebec), or an MD Private Investment Counsel Portfolio Manager.

Estate and trust services are offered through MD Private Trust Company.

1 An “executor” is called a “liquidator” in the province of Quebec and an “estate trustee” in the province of Ontario.

2 In Canada, a power of attorney can be called a “continuing power of attorney,” “enduring power of attorney” or “protection mandate,” depending on the jurisdiction and the terms contained in the document. A power of attorney for personal care can be called a “representation agreement,” “personal directive,” “enduring power of attorney appointing a personal attorney,” “health care directive,” “advance health care directive” or “protection mandate,” depending on the jurisdiction.

The above information should not be construed as offering specific financial, investment, foreign or domestic taxation, legal, accounting or similar professional advice nor is it intended to replace the advice of independent tax, accounting or legal professionals.