Looking beyond your Will
Do you have a Will? Is it up to date?
If not, you are not alone. According to a survey done by Angus Reid, 51% of Canadians do not have a Will and of the ones that do have a Will, 75% of them claim it is out of date. Some of the reasons given why people do not have Wills were they thought they were too young, they didn’t have enough assets, or it was too costly.
Are you aware of the implications of dying intestate, without a Will? Have you considered the costs and the impact this might have on your family? The Will is the legal document that explains your wishes about your assets and not necessarily your personal intentions and wishes for your loved ones. Completing an estate plan is more an exercise and process that is selfless and directed towards the compassion for the next generation. At the end of the day, your wealth could be their wealth. Are you ready to empower and prepare the beneficiaries of your wealth to become engaged stewards and contributing individuals to society and family with purpose?
This is the Estate Planning process.
For some families, the Estate planning process might start out of need for tax planning. However, tax planning is very different from intergenerational wealth planning. The most important starting point should likely NOT be tax. It should be legacy and values driven. What is the purpose of your wealth? Why does it exist, what can it provide, who is a part of it, what will it stand for? There are several reasons and benefits to completing the planning process including family cohesion, risk management, plan optimization, clarity on goals, empowerment, etc. It can lead to higher functioning families, better communication skills and member engagement to help the family thrive for generations to come. This article is geared towards families that will outlive their wealth and therefore require a plan beyond perhaps just the next generation and one for many generations to live out. Inclusive planning will help to increase your family’s chances of success; defined as wealth transferred from one generation to the next without contention and inappropriate expenditures, but rather with stewardship and continued growth.
The planning process is dynamic and iterative. It should build in flexibility and malleability to be able to adjust to new systems, new people, new technologies, and new discoveries that the future will inevitably hold. A ridged plan handcuffs and stifles innovation and ambition. There are ways to protect and prepare for the “what if” scenarios without ruling from the grave. Have you considered what might happen if there is an out of order death, a relationship breakdown, a child with a disability or addiction issue? All of these scenarios require flexibility within the plan and the ability to adapt and change to meet the needs of the family and to help live out the intention/purpose of the wealth. Thoughtful preparation and planning as a collaborative group, including family members and professionals, is the key to the success of such plan.
Are you ready to engage and start the process? Lets start the conversation and we can share with you the next steps. Please reach out to our team to do so.
The steps of the plan are fairly straightforward. You start with the disclosure and discovery phase where we uncover what currently exists, review the documentation, list the family assets and ownership structures, and define who family is. We would also work through understanding the family objectives, values and long term mission/purpose of the wealth to ensure there is continuity when decisions are being made about any changes or new strategies are introduced to the plan. Once the foundation is starts to take shape, a deeper dive into identifying strategies and evaluating them can take place. Understanding the benefits and consequences of each plan and reviewing them with different perspectives, can help refine which path to take. The next step consists of gaining a collective understanding and getting buy-in to then implement the strategies. Over time, any material event that occurs within the family, a review of the strategies and plan needs to take place.
Steps in the Estate Planning Process
1. Discovery & Disclosure
- Gather and disclosure all pertinent information with respect to the estate, family assets, ownerships and family members
2. Determine & Define the Purpose
- What are the objectives and common goals that the family is attempting to achieve in the long term
- Work through uncovering the driving values and factors that will help the family make decisions
3. Analysis, Identify and Evaluate Options
- Determine where they are current gaps or irrelevancies and work towards implementing strategies aligned with the family values and goals
4. Make Decisions & Implement Strategies
- Collaboratively work through the strategies available and implement and update documentation to reflect the governance of the family assets going forward
- Design a roadmap for implementation and construct a multi-disciplinary team to help implement
5. Monitor & Review
- Start to formalize the process and hold family meetings to review the plans and any material changes that would require updating the plan
Keeping in mind, a Will is a document that outlines how to distribute assets that are in your name at the time of death. Typically, a Will does not outline how to manage the assets and what the purpose of the wealth is for the next generation. This is the purpose of Estate Planning. We want to prepare our loved ones with the skills, insight and ambition to help them thrive as individuals and as a collective group to essentially allow the family to live out its purpose building on the wealth and well-being of the entire family.
If you would like learn more about the process and how our team can help you optimize your estate plan, please reach out.