Life is unpredictable, and no matter how hard you work it’s impossible to escape death. That’s why estate planning is such a necessary part of the financial planning process. If you want to protect your family, your business, and your legacy, you’re going to need help from an experienced estate planning lawyer. The team at Merchant Law has the experience that it takes to ensure your wishes are carried out after death.
Who needs an estate plan?
Anyone who has gathered significant assets should consider investing in a formal estate plan. While it is possible to work up a legal will without a lawyer, DIY estate planning is rarely truly up to the challenge of protecting your assets. Mistakes in your will can open it up to challenge, and you could miss opportunities to pass assets to your heirs without pushing them through the probate process. There are also a number of life complications that make a lawyer’s help vital. For example, multiple marriages can complicate the lines of inheritance. Estate planning can protect assets for the children of earlier marriages or can give you the option of providing for beloved step-children. Entrepreneurs, business owners, and people who are deriving income from intellectual property also need formal estate planning. This can ensure the business survives you, or that royalties, licensing fees, and other sources of passive income continue to flow to the people who you’d like to see receive them. You also need an estate plan if you want to provide for anyone who wouldn’t normally be covered by the Wills and Succession Act of Alberta, or who might normally be at the end of the line. These individuals can include elderly parents, siblings, or grand-children. They can also include individuals who have worked hard to help you build your business without seeing much reward during your life, or charities whose causes you’d like to support. Very few people have a simple enough class of assets or simple enough life circumstances to complete the wills and estate process on their own. Think carefully about your life circumstances, and your goals, before assuming that you do.
What happens if you die without a will in Alberta?
Dying without a will is known as dying “intestate.” When this happens the courts must distribute your assets according to the Wills and Succession Act. The Act is quite straightforward and makes no allowances for the needs of individual family members. The Act begins with your current spouse or common law partner. If you have children in common then the entire estate will go to them. If you have children from a previous marriage then your current spouse receives 50% of the estate. Your children (adopted, or natural-born, but not step-children) receive the rest. Your grandchildren are up next, if your children are dead. If there are no children and there is no spouse then the courts begin going through the rest of your next-of-kin in this order: parents, siblings, nieces/nephews, and still more distant next-of-kin. If no blood relatives may be found then the estate goes to Alberta. Dying intestate can result in your assets going to a family member you don’t get along with, or one you barely know. It can send all of your assets to individuals who don’t need the money while passing over the ones who do, and desperately. If you want to have more of a say in the way your assets are distributed than this then you need to make an appointment with an Alberta wills and estates lawyer today.
What should you bring to your estate planning appointment?
Preparation begins with a conversation; two if you have dependent children. The first conversation you should have is with the person who you would like to serve as the executor of your will. That individual needs to consent to the role, and you’ll need to provide your lawyer with their contact information. You can name any executor you want. The second conversation you should have is with the person you’d like to serve as your child’s guardian should you and your spouse both pass. Again, this person has to consent to the role; you shouldn’t name them without speaking to them first. Your lawyer will need their contact information, too. Once you’ve done that you can begin gathering and organizing your documentation. You’re going to need paperwork for all of your assets and debts. You’re looking for bank statements for checking accounts, savings accounts, retirement accounts, and investment accounts. You’ll need to gather tax returns and real estate documents. If you have vehicles you’ll need titles for those vehicles. If you have valuable collectibles, you should make a list of them and their approximate worth. If you have a business you’ll need to gather your business agreements, P&L, and other helpful valuation documents. If you have intellectual property bring licensing or royalty agreements. If you have a life insurance policy, bring a copy of the policy. Gather up real estate deeds as well. Bring copies of all your bills, too, as outstanding debts will need to be addressed by the estate. Next, write out a list of your intended beneficiaries. You’ll want to include contact information: names, dates of birth, social insurance numbers when you have them, addresses, and phone numbers. Keep in mind that will and estate planning are not “one and done” activities. We recommend reviewing your will and estate plan every 3-5 years to make sure that your estate plan continues to match your needs and goals. Look for a lawyer who you trust to share a long-term relationship with you. Your lawyer may even serve as the administrator of your will if you so choose.
Does a will protect your assets from probate?
Not necessarily, though proper estate planning can pass some assets without forcing them to go probate. There are times when a will does not require probate. It depends on the size and complexity of your estate. It is best to draw up your estate plan with the understanding that it is likely to go through the probate process. The probate process validates the will and approves the distribution of the estate as outlined in the will. Probate fees are very low in Alberta in comparison to the rest of the country.
- If your property is worth less than $10,000 the fee is $35.
- If your property is worth $10,000 to $25,000 the fee is $135.
- If your property is worth $25,000 to $125,000 the fee is $275.
- If your property is worth $125,000 to $250,000 the fee is $400.
- If your property is worth more than $250,000 the fee is $525.
The fees are generally collected from the estate prior to the distribution of the other assets.
What is the average cost to draw up a will?
The cost of a will and estate plan will vary wildly depending on the complexity of your asset profile and your goals for the estate planning process. Often, we can get the job done for anywhere from $300 to $3000. When you make your appointment we’ll discuss our fee schedule so there won’t be any surprises. We can often have a will complete in 48 hours. If you have more complex estate planning needs then we might need as long as a week to get everything set up for you. Nevertheless, estate planning is time and money will spent.
Are a will and an estate the same thing?
A will is a component of an overall estate plan. For some individuals, the will is the only portion of the estate plan that’s truly necessary. For others, the estate will include other components, such as trusts, insurance policies, buy/sell agreements and property held in common with other individuals. Don’t assume a will alone will be your best solution until you consult with an estate planning lawyer.
How does a trust work after someone dies?
There are dozens of kinds of trusts that you can set up, all serving different purposes. Trusts generally allow you to set conditions for how the money will be used. For example, if you are trying to provide for the long term day-to-day needs of family members, a spendthrift trust can distribute a set amount every single month. Tests are either testamentary trusts or living trusts. A testamentary trust takes effect after you die and must go through the probate process along with the rest of your assets. By contrast, the ownership of a living trust passes immediately to your beneficiaries upon your death. The assets placed in the trust do not pass through the probate process. It is vital to choose the right type of trust to meet your aims and goals for your estate. A trust is a complex legal vehicle and is not something you should attempt to put together on your own.
Who can challenge a will?
Wills may only be challenged by specific individuals and under specific circumstances. Spouses, common law partners, and adult children may challenge a will, as may anyone else who has a financial interest in the estate. Your own lawyer may challenge a will if they feel it does not match what they have on file. Challenges may also be made by the Public Trustee. Usually wills are challenged by dependents who would be depending on your estate to survive. This would happen if the estate plan “failed to provide adequate support.” If you had all of your assets going to charity, for example, while a spouse or child was still relying on your income, then the will might be challenged to reallocate those assets back to the member of the family who requires them to survive. Other grounds for challenging a will have to do with the validity of the will itself. For example, if the challenger suspects that you did not have the mental capacity to understand your own estate at the time when you wrote the will, or that you were a victim of intimidation or fraud, then the will may be challenged on the grounds that it is not a valid document. Working with a lawyer helps to protect your estate from these kinds of challenges as theoretically your own lawyer would advise you against changes when you are not in a good place to be making those changes. A will may be challenged if it fails to meet the standards for legal validity as well. For example, if you fail to have your will witnessed properly then it would be open to challenge. Again, working with a lawyer can help protect your estate from these kinds of problems. When your will is challenged the courts may revert to an earlier version of the will, may make slight modifications to the will, or may invalidate the entire will just as if you had died intestate.
Why choose Merchant Law to be your estate planning legal team?
We are a team of award-winning, highly respected lawyers. Most of us have been practicing for decades, and we all help each other help our clients succeed. Many of our lawyers have backgrounds in other areas of law that are especially helpful to the estate planning process, including real estate law, business law, and civil litigation. We can understand the most complex estate and advise you on all of your options so you are armed with the information you need to make appropriate decisions for the people who matter the most. Nobody knows what tomorrow may bring. Don’t leave your will or estate to chance. Call (403) 225-7777 to set up your estate planning appointment today. We have offices in Airdrie, Calgary Bowness, Calgary, Cochrane, Red Deer, and Edmonton, but we serve the entire province. We offer secure, remote appointments for your security and convenience. If you’re an Alberta resident, we can help. Contact us today to get started.