D. Smith: Doing your homework on will planning will save you money

Almost 50 per cent of all people who should have a will don't. Many others who have an existing will should consider updating it.

A will is a very important legal document to facilitate the transfer of your accumulated assets upon your death.

Unfortunately, almost 50 per cent of all people who should have a will do not have a will.

Many others who have an existing will should consider updating their will.

Changes that should trigger a review of a will are: a marriage, divorce, the birth of a child, moving to a new province or country, the death of a previously named executor or family member, or a substantial change of finances.

A will becomes invalid when someone remarries and in today’s world of blended families, it is important to update your will or make a new one after a marriage.

If you want your children and family from a first marriage to be the beneficiary of assets in your will, you must make a new will when you remarry.

Estate administration of a will takes up to 18 months for a straight forward estate process.

Complications such as dying without a will, estate litigation, feuding family members, or business ownership not properly addressed in the will can delay the process for years.

The provincial probate fees in B.C. based on the total estate value are 1.4 per cent, plus legal and accounting fees.  The accumulation of these fees can add up to five per cent or more of the total estate value.

An executor should be named after careful consideration of the many duties he or she is responsible for.

The duties include: filing tax returns, determining estate values, making funeral arrangements, ensuring all debts are paid, working with financial institutions, lawyers and accountants, and distributing assets in the will.

When you choose your executor, consider the time involved by this person(s), as the process can take about two years.

Most Canadians choose a family member to be their executor, and for many people this may be their first experience in acting as either the sole executor or co-executor.

This can be a time consuming and difficult process. You can also choose a company who has experience in estate administration.

If the estate has considerable assets, a knowledgeable professional can assist in tax strategies saving the estate money.

The cost of a will can vary between law firms and notaries.

Some people do not have a will prepared due to the initial cost for this legal document while others procrastinate.

However, if you do not make a will and die intestate, or if you have an out of date will, the legal costs typically cost $250 per hour.

Suddenly the cost of having a will prepared is very reasonable and should save you money with estate planning.

During our lifetime we should use common sense and cost effective strategies to protect our assets.

Joint ownership of assets, using life insurance products to bypass probate, and gifting assets during our lifetime will avoid costs and fees and stress after death.

Some people do not make a will because they do not want to face the reality they may die someday.

The reality is each one of us will pass some day from this earth and leave all our materialist possessions including real estate, bank accounts and other financial assets.

Very few of us know the day and time when our passing will occur.

So take action to plan beyond the unknown.

Kelowna Capital News