Managing an estate is a profoundly delicate endeavour fraught with uncertainty, inequality, and conflict.
Inheritance inequalities and individual taxation will muddy even the most durable families. Estate planning requires personalized guidance and taxation expertise. Successfully planning your future affairs is the culmination of balancing your goals with the difficult decisions that truly impact what matters.
Charitable Giving Planning
Have you ever wondered how you can give back to your community in an impactful way? As you plan for your estate, including a charitable giving component can be advantageous in minimizing the reduction of your wealth due to taxes.
Wealth Transfer Planning
You have worked hard and been smart in both your business and personal life. Over the years, you have accumulated significant assets - more than you will ever utilize in your lifetime.
Eventually, all of us will have to have our estate settled. Whether small or large, there is planning that needs to take place for your estate. Life insurance can play an essential part in your planning process.
Do you often wonder whether you should establish a Trust? Have friends or colleagues mentioned that they have a Family Trust? Or maybe you heard someone on the radio talking about trusts as a way to “protect money from tax.”
What I don't know, but should?
The process of estate planning can involve many aspects of your life. Once you pass on, and after paying any debts, funeral expenses, taxes, fees, or other expenses, you may be interested in engaging in a more meaningful, legacy planning process to leave your mark on society.
“For clients that have built up a significant amount of wealth in their lifetime, they want to make sure it is respected and it is treated responsibly. ”
John Guderyan, Sagium
Frequently Asked Questions
What are some basic first steps to begin planning my estate?
Step 1: Create an inventory of your assets and liabilities
The first step in planning for your estate begins with an inventory of your assets and liabilities. At this point, you will also want to start having conversations about the possible beneficiaries of your estate.
Step 2: Create your Will
Now that you have a clear list of your assets, it is time to determine what to do with those assets and document those wishes in your Will. A Will is a document that lays out instructions for your executor to follow related to dealing with any outstanding liabilities and the distribution of your assets to your beneficiaries. Your Will is the most critical component in your plan and will require some legal and tax support.
Step 3: Designate an Executor
When preparing your Will, you will need to designate an executor (and consider an alternative executor) of your estate. An executor is someone in charge of paying your debts and distributing the assets in your estate according to your Will’s instructions.
The settlement of your estate may be very cumbersome and require the executor to spend a significant amount of time contacting the various people and organizations associated with your estate. So, it is imperative to put together a well-laid-out estate plan that provides your executor with the necessary information to carry out your final wishes.
How can I minimize taxes during my estate planning process?
Estate preservation and minimization of taxes upon death are critical to estate planning. When tax-deferred assets such as RRSPs or RRIF’s are included in your terminal income tax return (your final tax return after death), it is especially true. First, you should consider tax deferral opportunities associated with these tax-deferred assets. In addition, attention should be given to the fair and equitable distribution of your estate to your children and others who are dependent upon you.
What happens to my business if something happens to me?
As a business owner, you may be concerned with what to do with your business assets once you pass on. If your business assets are a part of your estate plan, it is essential that you coordinate with other shareholders and family members who are involved in the business. Discussions and agreements with these groups should be well-articulated and documented with all parties involved.
Essential questions to ask are:
- Who will retain or take ownership of the business?
- What provisions will be set aside to have the company’s shares owned by those expected to control the business?
“You might hear us say this again, but creating wealth is just the beginning.”
You have three choices for your assets: family, charity or CRA. Pick two.
A well-thought-out estate plan takes a broad perspective and focuses on preserving your wealth while incorporating strategies and tools to minimize the impact of taxes now and for your family.