When Is The Best Time To Make A Will?
If you’re of legal age, you should think about an estate plan. As we like to say here at Epilogue: The best time to make a Will was yesterday, and the second-best time to make a Will is today!
Many people in Canada (approximately 51%,) don’t have a Will. A Will is crucial in the estate planning process since it allows you to have control over the important things and make decisions about what happens after you’re gone.
If you would like to make sure your loved ones are taken care of in the way you would want, you have to have a valid Will in place.
A Will isn’t for you, it’s for those you leave behind to ensure there are clear instructions left behind about who should manage your estate (the “executor”), who should care for any minor children (the “guardian”) and who should get your stuff (the “beneficiaries”).
A Last Will and Testament should evolve as life changes
A Will should reflect your wishes throughout your life. Life changes all the time whether it be health status, relationship status, or acquired assets – so it’s a good idea to update your Will accordingly as your situation and wishes change. Most people tend to update or make a Will during major life milestones, including:
- Major financial changes
- Marriage or becoming common-law
- Having children
- Getting a pet
- Divorce or separation
- Moving to a different country
Major change in financial position
Whether it be receiving an inheritance, winning the lottery, buying a house, or selling a business, or opening investment accounts, big changes in your financial status can impact your life.
To ensure financial assets are distributed among the important people in your life, you need an up-to-date Will. Without a Will, the rules of the province will dictate who gets what.
If you have recently experienced a major change in your financial situation, it is a good time to think about making or updating your Will.
Getting married or living in a common-law relationship
Entering into a long-term partnership represents a new chapter in your life. And this often changes how you would like your assets distributed. With a spouse or partner to consider, it’s important to include them in your estate planning.
When it comes to common-law relationships, this is especially important. Some provinces in Canada don’t consider common-law partners the same way as they do spouses. So, to ensure your common-law partner is taken care of the way you want, you need to have a Will.
If you die without a Will, your common-law partner would need to go to court to make a claim for your estate, adding stress to an already emotional time.
As a parent, the safety of your children is a priority. Part of caring for them means protecting them, no matter what. And that means considering what will happen to them if you (or you and your spouse/partner) are no longer around. Nobody wants to think about that, but it is an important part of parenting that is too often overlooked.
As a parent, there are three main considerations when it comes to your Will:
- What will my children inherit in terms of money and assets?
- At what point should they receive some (or all) of the money and other assets?
- Who will you name as guardian to take care of your children if you and your partner pass away while they’re minors?
In Canada, if someone dies without a Will (called dying intestate), their children receive their inheritance at the age of majority in the province where they live in one lump sum. Even your spouse won’t be able to dictate the distribution of money to your kids if you die intestate. It all gets distributed according to the laws in your province.
Perhaps the most important reason for parents to have a Will is to name a guardian. While it can be difficult to imagine anyone but yourself raising your kids, it’s better to have control over who this person might be rather than leave it up to the courts to decide.
Wills are not meant to be static, unchangeable documents. They can (and should) be updated throughout your life. When it comes to guardianship, you should feel free to update your guardianship appointment if your circumstances change. For example, if your relationship with the existing guardian changes, if the guardian’s life circumstances change so they can no longer assume the role, or if you have more kids and change your mind about who the best person would be to take on the role.
Getting a pet
Anyone who owns a pet understands why they’re called “fur babies”. They are basically treated (and loved) like children.
But under the law, pets are considered property. To make sure that the right person ends up taking care of your pet, it’s best to have a Will. When you make a Will you can choose a trusted person to care for your pet when you’re no longer here.
While you can’t leave money to your pet directly, you can leave a monetary gift to your pet’s guardian so they can maintain the quality of life your pet is accustomed to.
Getting divorced or separated
Any change in relationship status is a good time to re-evaluate, update or make a Will.
Having an up-to-date Will in place becomes extra important during a period of separation. According to the law, separations aren’t recognized the same way as a divorce. Any time a significant relationship changes, it’s a good time to review your Will to make sure it reflects your current wishes. Moving to a new country or province
In Canada, the laws around Wills and estate planning are different in each province. If you move to a new province, it’s a good time to consider if an existing Will needs to be updated. . Moving locations is a good time to familiarize yourself with the estate laws and the intestacy rules in your new country or province of residence.
What if I don’t have many assets?
For young people who may not have traditional assets, it’s important to realize that a Will helps protect digital assets too. Think NFT’s, cryptocurrencies, websites, etc. The executor named in a Will is tasked with managing all of the deceased’s property, which includes digital assets as well.
When it comes to social media accounts, Epilogue developed the Social Media Will which helps people let their loved ones know what they want to happen with each social media account they have.
How do I make a Will?
The two most popular ways to make a Will are:
- Doing it online; or,
- Working with a lawyer.
For many Canadians, an online service like Epilogue will meet their needs. For those with more complicated situations, it’s best to see a lawyer. A more complicated situation includes things like:
- When someone wants to exclude a child or spouse from their Will
- When someone is in a second marriage and has kids from a previous marriage
- When someone has a lot of assets outside Canada
- When someone has a child with a disability receiving government benefits
- When someone has complicated tax questions that require a lawyer’s advice
Depending on your preferences and specific situation, the choice is ultimately yours. The most important thing is to ensure that your Will is properly executed and therefore legal (in other words, enforceable by law) and follows the legislation in the province you reside in.
What about Powers of Attorney?
A Will doesn’t eliminate the need for a Power of Attorney. A Power of Attorney is an important document to have in place as it deals with what happens if you are incapacitated (but still alive.) A Will, on the other hand, only deals with what happens after you pass away.
While you’re alive, you can designate a person to act on your behalf when it comes to your personal care and/or finances, if you’re not capable of doing so yourself. The best time to make Powers of Attorney is when you make your Will. You should store all of these important estate planning documents together and ensure your executor knows where they are.
You can (and should) make changes to your Will
With Epilogue, you can update your Will in a relatively easy manner. Just log in to your account, make your changes (often offered for free), and print and execute your Will again.
If you are using a lawyer, you can create a new Will with them, or have them create something called a Codicil, that is signed and attached to your existing Will.
A Will should be a living, breathing document that evolves as your life changes. A Will should always reflect your current wishes.
The costs associated with updating a Will varies from free to hundreds–or even thousands–of dollars, depending on whether you go with an online solution or the lawyer route.
When to update your Will
If there is a big change in someone’s life, that is a good time to review any existing Wills. If there are no major changes, it is wise to review (and potentially update) a Will every 3-5 years.
Life can change quite a bit in just 3-5 years when it comes to relationship status, financial position, or place of residence.
What happens if I die without a Will
Dying without a Will is called dying intestate. When someone dies intestate, the two biggest challenges are:
The time required for your loved ones to get access to the estate; and,
Leaving decision-making power in someone else’s hands—someone you may not have wanted to act on your behalf.
Preparing to make a Will
Here is a list of questions to ask yourself while making a Will:
- Who will be your executor?
- Who will take care of your children and/or pets?
- How will your assets be distributed?
- How will my common-law partner be taken care of?
- How will money be distributed to minors?
- Which charity will I be contributing to?
- What happens to my digital assets?
Epilogue created a Will preparation checklist to make sure you feel confident when starting to make your Will. Check it out: Will Preparation Checklist