Whichever way you look at it, preparing an estate plan remains one of the most tedious things you will ever do. And the reason why it is considered tedious is very easy and pretty much straightforward -It is not that easy to think about one’s death! But then again, whether you like it or not, we are all going to die. Hence the reason why it is absolutely vital to take the necessary measure of developing a comprehensive estate plan that will ensure that your estate is distributed accordingly in the way that you will like it even after your absence.
As complicated as this sounds, good estate planning can solve a host of problems and it is something that you can do at any time in your life. That is, you necessarily do not have to wait till you are old or retired before you plan your estate because as we all know, life is generally unpredictable! Things can happen literally anytime and any day. So, therefore, to prevent complications for your loved ones after you are gone, you should have a solid estate plan.
The thing is, we can liken estate planning to a house renovation, there are bound to be problems and of course, something may go wrong along the way or after the renovation. And that is why in this piece, we are going to explain some of the common things that people in British Columbia often overlook when making an estate plan.
What are Some Common Mistakes People Make When Planning Their Estate And How To Avoid Them?
In British Columbia, even though a lot of people know and understand the importance of estate planning/will, a lot of people still don’t know how to about the whole process, and most of the time, they end up making avoidable mistakes. So without much further ado, let’s take a look at some of the common mistakes you need to avoid while preparing an estate plan.
Not Hiring the Right Estate Executor
Goes without saying that the competence level of the estate executor you hire will determine how successful the process will be. Picking the right estate executor is the first step you have to take while planning your estate or will. If you live in British Columbia and you are trying to plan your estate, It will be counterproductive to hire an estate executor who will not get the job done alright. One rule of thumb that no one will ever tell you is that you should have an alternate executor should in case the one you hire couldn’t deliver.
Not Reviewing And Updating Your Will Regularly
As we said previously, life is very unpredictable – a lot of unplanned things can happen over the course of your life, hence you must review and update your will regularly. For example, you will occasionally be required to review your will when you:
- Adopt or give birth to a child
- Invest in a property or business
- When you buy a car, house, or any other assets.
- Loss or addition of beneficiaries
- Mental or physical health has deteriorated
- Divorce, etc
When you experience any of these, you will be required to review and update your will. This change in the estate plan can however be done in two ways. One is by codicil preparation and the other is by plotting a new Will entirely.
And lastly, in British Columbia, it doesn’t matter if you’ve experienced any of these changes, the law still mandates that you review your will every 3-5 years.
Doing It All Yourself
While it is okay to do some things all by yourself, planning your estate is something you can’t handle all by yourself. This is because the estate law in this state is very complex, and a few errors/lapses can have legal consequences. So to avoid legal problems before or after you are gone, you have to hire an expert as the estate laws in BC are complex and ever-changing.
There are some things you shouldn’t risk, estate planning and your Will are one of them. And so, you must get your documents in the right order to ensure that all your properties are protected by the law. And when it is time to transfer them to the right beneficiaries, there won’t be any problem.
Thinking You Don’t Have Enough Money
One of the craziest misconceptions flying all around is that Estate planning is only for the rich and famous – this myth is very wrong and misleading. Although, indeed, advanced estate planning techniques may only apply to people of considerable wealth or the most famous people. But notwithstanding, individuals with assets of value can also benefit from a well-defined estate plan.
Adding a Minor as Co-Owner
It is not always advisable to name a minor as a co-owner and a direct beneficiary. Because it only means that you are legally gifting half of your asset to that minor. You are probably wondering “why is that a problem?”. Well, I am glad that you ask.
Adding a minor (your child) as a co-owner might subject you to gift tax. That is not all, if after you’ve passed away, and your child is being pursued by creditors, the money in the joint account may be vulnerable. That is, the creditors may have a claim over that money!
So instead of adding your minor as a co-owner, you should prioritize passing your inheritance to your heir through a trust (Trust Fund). That will ensure that creditors do not have legal claims over that money.
Conclusion
Life, they say is unpredictable, but while you are still alive and breathing, it is not too late to plan, review and update your estate.
Therefore, if you are a resident of BC and you are in need of qualified wills and estates lawyers, then don’t hesitate to contact Saanichton Law Group today! With over 25 years of experience in estate laws, we are committed to preserving the best interests of families across South Vancouver Island, Mayne Island, and the Greater Victoria area.
