A Basic Overview of the Importance of Executing a Will
As a lawyer, this is a question that I have been asked many times. “Do I really need a Will?” “Is it worth it?” “I’m not a millionaire, so what’s the point?”
The easy answer is: having a Will provides you with the comfort of knowing that your estate, no matter its size, will be handled in the manner in which you choose. It gives you control. Furthermore, it makes the winding up of your estate much easier and more straightforward for your family- something that can, in itself, be emotionally draining and difficult.
To get a better idea of what this means, I will go over the basics:
What is a Will?
A Will is a legal document that provides instructions on how an individual’s estate will be distributed after death. It comes into effect once a person dies.
What is the purpose of a Will?
The purpose of a Will is to ensure that the estate is distributed in the manner the deceased desired, to provide authority to the estate trustee (also known as an “executor”), and to provide protection for the estate and for the rightful beneficiaries.
What clauses are included in my Will?
A Will can include many provisions. However, the standard will should include, at the very minimum, the following: appointment of an estate trustee, authorizing the estate trustee to act on behalf of the estate, and instructions for the distribution of the proceeds of the estate (after payment of debts). The Will can also include provisions for investment of trusts, appointment of a guardian for children under the age of 18, funeral instructions, and many more.
What is covered by my Will?
A Will encompasses all of the assets of the deceased, but there are some exceptions. The estate generally includes real property, vehicles, interests in corporations, investments, bank accounts, jewelry, artwork, among others.
However, life insurance policies or pensions that have a named beneficiary are not included in a Will- so if you have named an individual as a beneficiary under one of these plans, ensure that you have listed the correct person on that plan since a Will cannot change that designation.
Furthermore, a home owned with other individual(s) as “joint tenants” does not fall under a Will. Upon the death of a joint tenant, his or her interest in that home automatically transfers to the joint owner(s). This arrangement is very common between spouses. However, it could cause problems, for example, in the event that a brother and a sister jointly own a multi-family cottage. If the cottage is owned jointly, and the brother dies, his portion would not go to his wife/children, but instead would automatically transfer to his sister, leaving his wife/children with no claim to the cottage. If the brother wanted his ownership to be included in his Will to be left to his wife/children, the ownership must be changed to tenancy-in-common. If you do want your interest to form part of your estate and to transfer to your beneficiaries, make sure to discuss your options with a lawyer.
Why draft a Will?
In addition to ensuring that your wishes are met, it is important to draft a Will because it is the best method of providing your family with the ability to deal with, and wind up, your estate. For estate trustees, a valid Will can be used to obtain money from bank accounts, discuss options with lawyers, and sell your property. It provides your estate trustee with the authority and protection to act on behalf of the estate. Furthermore, someone who acts on behalf of the estate without proper authority can open themselves up to potential liability. This can occur, for example, if debts are not properly paid out or if the estate is distributed too soon or to the wrong beneficiaries.
Why do I need a lawyer?
A lawyer with experience in wills and estates law can assist in ensuring that your estate is distributed in the method that you choose and in a manner that best protects your beneficiaries. There are many rules with regard to wills and estates. If drafted improperly, for instance, your Will can accidentally disinherit a beneficiary or include individuals that you did not want to be included. Furthermore, an improperly executed Will can be deemed invalid. This can happen if there are issues with signing of the Will, improper and insufficient amount of witnesses, or unclear distribution wording, among others. If your Will is deemed invalid in Ontario, your estate will be distributed as if you did not have a Will, or in other words, in accordance with the intestate rules under the Succession Law Reform Act, 1990. Please see my article, What happens if I don’t have a Will? for more information.
Where do I go from here?
This article is a brief overview and generalization of the many aspects and points to consider when drafting a Will. There are many specific rules and procedures that govern this area of law and as such, certain facts and realities impact your situation. Please contact a lawyer to discuss your specific situation.
If you do not have a Will, or you do and would like to update your existing Will, please feel free to contact our firm and one of our lawyers would be happy to assist you and your family with navigating this complicated area of law.
Wills and Estates Law Contact:
Thunder Bay, Lawyer