One cannot be engaged in an estate planning practice without being asked “why do I need a Will”. For those living family members of the recently departed entertainer, Prince, the answer will, unfortunately become all too clear. According to numerous news reports, the iconic entertainer died without a Will. As a result, the surviving family, comprised of siblings and half-siblings, can expect the legal issues to carry-on for quite some time before their brother can truly rest-in-peace.
The fact that Prince, an individual who has achieved phenomenal financial success, died without a Will, is proof that the lack of Will planning cuts across all socioeconomic brackets. Even wealthy people fail to plan their affairs. So what is it about Will planning that leaves people never taking the time to get it done.
According to a survey done in 2012 by LawPro’s Title Plus, 56% of Canadians of the age of majority do not have a Will. The largest demographic age group represented is that of age 27 to 34, where 88% of Canadians do not have a Will. The most common reason given among this age cohort – they believe they are too young (21%). The irony is that the most appropriate times to engage in Will planning, whether it be for the first time or to review and update your Will plan, is when major life events occur. Despite not having empirical data to support the following statement, it is likely fair to say that this age cohort experiences many of life’s milestones when one should think about Will planning – getting married, establishing a common-law relationship, buying their first home, or having children.
Another common reason given by Canadians surveyed for not having a Will (29%) was a lack of understanding about how to get started and the perception that the cost to get a Will done is something they cannot afford.
It is unfortunate if a lack of understanding about how to get started is really stopping Canadians from getting a Will. While there is some work to be done, it is no more than what one might do to get ready for your annual physical. You should get a family tree together, prepare a list of your assets and liabilities with values and think about what you want to have happen to your estate when you pass away and then when your spouse passes away. Your lawyer should then review all of this with you, while also thinking about any relevant tax planning that can be done.
With respect to tax planning I would encourage readers to avoid what I call the “cocktail party” chatter or the “over the neighbour’s fence” advice approach. Engaging in any form of tax planning has costs and benefits. An assessment of those costs (including potential risks) and benefits must be undertaken before engaging in any tax planning. What someone else has done as part of their Will planning may not have been correctly done or, as I have seen too many times, it may not have been done with a real understanding of the risks.
In terms of the costs to get a Will done, like most things today – there are numerous options, at differing price points. Unlike many things today though, there is a real distinction, in my view, among the service provided in order to obtain the ultimate product. One can certainly complete a Will following the virtually no-cost-do-it-yourself approach or the low-cost but high-volume, piece-meal approach. Relying on either of these approaches must, however, recognize that its “buyer beware” as to the ultimate quality.
Or, one can take the time to work with a qualified professional advisor who knows what they are doing and, more importantly, cares about your family and ensuring your Will plan is done right. While the latter approach may cost you more initially, in many cases it will end up costing less overall. Should issues arise due to reliance one of the former two approaches, the costs to address those issues, will undoubtedly far exceed the costs of a professionally drafted Will.
Ultimately, as one commentator on the death of Prince has aptly described the situation: “It comes down to taking care of business. If you don’t take care of it, you’re leaving a mess for your family or the courts.” Don’t let your legacy for your family be one of a headache to add to the heartache. Get your business taken care of.