Parents are forced to have a lot of uncomfortable conversations with their kids as they progress through life.
Among those difficult to broach topics is death, its inevitability and its often-unexpected arrival.
Once a child reaches adulthood, while a parent may not need to address sex or sexuality or other delicate subjects, the conversation about death is one that should present itself again as parents begin to make their end-of-life plans.
A key component of that plan is the last will and testament.
“Having a will, even if you don't intend to do anything particular complex or controversial in your will, just having a document that provides some clarity to everybody and some direction can go a long way towards helping families understand how matters should proceed when they're in a time of grief,” explains Kyle Rees, a lawyer with O’Dea Earle in St. John’s.
But before an individual or couple brings other parties into that conversation, they need to have a conversation with themselves.
“A lot of the reasons that individuals put off making a will or never make a will whatsoever is because you have to accept, right from the get go, that you are going to die and all of the money, the property, and stuff you have acquired over the course of your life is not going to belong to you any more, it's going to go to other people,” says Rees “That can be a pretty hard thing to accept.”
Once you’ve had a frank discussion with yourself or as a couple about the provisions in place to deal with those assets it’s a good time to approach the intended beneficiaries.
And even though a will is a confidential document and there’s no legal requirement to divulge its contents to beneficiaries, Rees says it’s a good idea to give them some idea of the plans for the estate after death. In his view and experience, oftentimes estate disputes before the courts tend to stem from a child or relative expecting they are mentioned in a will only to find out they’re not.
“So having that kind of conversation with your family, while it might be awkward, I think it’s advisable to prevent anybody from being surprised later on,” notes Rees, adding that the same conversation should happen with the individual named as executor of the estate.
Technically speaking, you don’t need a will to divvy up an estate.
In Newfoundland and Labrador, where no will exists your assets are distributed pursuant to the Intestate Succession Act (ISA), which, in a general sense, splits the property between your spouse, if they’re alive, and your children in more or less equal shares. Similar legislation exists in every other province, but most of the formal requirements are similar across the country.
But the ISA doesn’t provide specifics as to how the estate is administered or divided. A will provides dozens more of options to ensure that your beneficiaries and their needs are met in the event of your passing.
Say for instance that a beneficiary is disabled and receiving government income and you don’t want this one-time gift to have any adverse effect on that income. You can set up a certain type of trust such that the gift will only supplement the government benefits.
The ISA route can also present a challenge in the event of one parent passing and the other left to raise their two children. While the intention might be to have the assets left to assist in raising the children, under the ISA those children would be entitled to a share of the estate.
“If we're dealing with two children it would be 50 per cent of the estate, so there would really be a requirement on the surviving spouse in that case to set aside the money to give to the children when they turn of age, which can be a very difficult thing to do when you're trying to make ends meet upon the sudden death of a spouse,” Rees explains.
It’s also quite handy in the event a blended family to avoid any confusion about where biological children and stepchildren stand, or current spouse and former spouse.
But the ISA does work well for single couples without any children or beneficiaries. Still, Rees says that even if you’re going that route, it’s still worth your while to sit down with a lawyer and draft a will.
“All of the wealth that you have accumulated through your years of frugal living and hard work will be transferred upon your death and that's probably the single biggest transaction that'll ever happen in your life and it'll happen when you're no longer around to watch it,” he says.
“The small amount of effort and small amount of money that it takes to get a will drafted by a professional is a worthwhile investment if you're going to be distributing this huge amount of money between your beneficiaries at a later date.”