You might think that a good Will might read as follows: “Being of sound mind… I spent it all”. But if you want to provide for your family and/or friends, you might consider the wisdom of having a Will.
What is a Will?
A written legal document setting out what is to happen after death to his/her property and who will be guardian of children. A will must be in writing and should be dated and properly witnessed.
(If you wish for someone to handle your financial affairs while alive, then prepare a Continuing Power Of Attorney for Property, which is effective only until your death. You may also prepare a Power of Attorney for Personal Care, which may instruct another person as to which medical, health or sanitary services should be provided to you, if you are unable to instruct them yourself.)
A Will Can be revoked or replaced by another will at any time as long as you are mentally competent. Because circumstances, beneficiaries or assets change, conduct an annual review, especially if you become engaged, married, separated and/or have children.
Why make a Will?
- If you don’t have one your estate will be divided according to provincial intestacy laws, which may not reflect your wishes. Property would devolve to your next of kin without regard for your fondness for certain people, and not to non-blood relatives, your common-law spouse or charities. With a Will, you maintain the freedom to benefit those as you please, for the most part.
- You will have the freedom to choose a guardian (custodian) for your minor children, a trustee of their money and specify at which age they will receive their inheritance.
- If you marry, your Will is automatically revoked unless it specifies that it is made in contemplation of a forthcoming marriage. If you are married but separated, your estranged spouse may inherit your share of the family property unless your Will or a separation agreement states otherwise.
- It is less expensive for your beneficiaries if you have a Will. If you to not, an Estate Trustee (the manager of your estate) will have to be appointed by the court and may be required to post a bond. Appointing a Trustee in a Will may reduce the potential for disagreements between beneficiaries.
Not all property passes by operation of a Will. Some pass by contract or by the operation of law. For example: jointly owned property (such as a house held in Joint Tenancy), or bank accounts, GICs, life insurance proceeds, registered RSPs, RIFs, and pensions payable to a designated individual, not to your estate.
The Will “speaks” from the time of death, so you may change a disposition, and deal with it as you please while alive.
You may leave your beneficiaries certain percentages and/or specific gifts (bequests) of property and/or money.
Provincial laws may apply to limit what you can do with your property. Your spouse may make a claim for a division of property or to take what is given to him/her in the Will. Children and spouses may claim to be “dependants”. “Dependents” may include: your: spouse, common law spouse, former spouse, children, including those born out of wedlock, born after the testator’s death and a person you treated as a child of your family (stepchildren), parent, sibling to whom you were supporting or have a legal obligation to support. You must make adequate provision for them, just as you would when alive. If you fail to make adequate provision, the court may order the estate to make payments to some or all of them in an amount it sees fit.
Children: You cannot give your children away as if they were property. You may however, appoint a guardian of the child’s person (custody) and a guardian of his property. The Court is interested in ensuring that it is in the child’s best interest to live with the custodian appointed by Will. Accordingly, the appointment of a guardian under the Will is only valid for 90 days after death, or later if appointee makes an application for an extension.
Gifts or inheritances: if received by one spouse are not considered property to be divided in case of separation. But the income therefrom is, unless it is specified in the Will that all capital and income from the bequest is not to be considered “community of property” (i.e. property to be shared by separating spouses).
Who gets what if you die without a Will? Under the Succession Law Reform Act, the spouse gets the first $200,000.00 of the net value of the estate. If there is one child, he/she also gets ½ of the residue, and the child gets the other half. If there is more than one child, the spouse gets the first $200,000.00 and 1/3 of the remainder and the children share equally the other 2/3.