Preserving Wealth: Chapter Six, Estate Planning – Wills and Powers of Attorney

Authored by Jack Lumsden, MBA, CFP®, Financial Advisor, Assante Financial Management Ltd. 

Chapter 6 discusses the intricacies of estate planning, focusing on wills and powers of attorney. On a rainy Saturday morning over breakfast Uncle Wayne leads a detailed discussion on ensuring one’s estate is managed according to personal wishes, covering everything from the basics of will creation to the responsibilities and selection of executors and attorneys.

Key Learning Points:

1. The Importance of Having a Will
   • Fundamental Necessity: A will is essential for anyone with assets or dependents. It ensures that your property and responsibilities are managed according to your wishes after your death.
   • Avoiding Government Intervention: Without a will, the government decides how your assets are distributed, which may not align with your intentions. 
   • Guardianship and Trusteeship: Parents should appoint guardians for minor children and consider professional trustees to manage significant estates, ensuring children are cared for without burdening family members.
2. Choosing the Right Executor
   • Roles and Responsibilities: An executor administers the estate, ensuring that debts are paid, and assets distributed according to the will. They must act in the best interest of the beneficiaries.
   • Selecting an Executor: Consider trust, ability, financial knowledge, and geographic proximity. Common choices include spouses, capable adult children, trusted friends, or professional trust companies.
   • Potential Conflicts: Be aware of potential family conflicts, especially when naming children as executors. It’s crucial to consider family dynamics and relationships.
3. Understanding Powers of Attorney
   • Types of Powers of Attorney (POA) : There are two main types—property and personal care. A POA for property handles financial matters, while a POA for personal care deals with healthcare decisions if you become incapacitated.
   • Activation and Limitations: A power of attorney for property is effective immediately upon signing, whereas a personal care power of attorney only takes effect when you are unable to make your own decisions.
4. Periodic Review and Updates
   • Life Changes: Regularly review and update your will and powers of attorney to reflect life changes such as marriage, divorce, the birth of children, or changes in financial status.
5. Professional Advice
   • Complexity and Costs: While DIY kits exist, professional advice is recommended. The upfront cost of professional services can prevent significant legal and financial complications later.
   • Detailed Instructions: Work with a lawyer to ensure your documents are thorough and legally sound, covering all aspects of estate management and personal care.

Estate planning is a critical component of financial security and peace of mind. Chapter 6 emphasizes the necessity of having a well-crafted will and powers of attorney, ensuring that your wishes are respected, and your loved ones are protected. By selecting appropriate executors and attorneys, regularly reviewing your plans, and seeking professional advice, you can safeguard your estate and provide clear guidance for your family. Preparing for the future with thoughtful estate planning is an act of care and responsibility that extends beyond your lifetime, ensuring your legacy is managed with integrity and respect.

You can read the full chapter HERE

For your FREE Copy of Preserving Wealth, CLICK HERE

What To Do Next

Are You on Track with Your Retirement Strategy? FIND OUT TODAY!

For more information, refer to Preserving Wealth: The Next Generation – The definitive guide to protecting, investing, and transferring Wealth by Jack Lumsden, MBA, CFP® or schedule a call with Jack at 905-332-4403