5 Mistakes to Avoid in Your Will to Save Your Family Grief
Your will is a legal document that is subject to court review. Keep these points in mind when reviewing or making your will.
1. Comply with legal formalities for signing wills
Each jurisdiction has different requirements for signing and witnessing wills.
In Ontario, even homemade wills must comply with these legal formalities.
You must have two witnesses see you sign the will in each other’s presence. They cannot be potential beneficiaries. A will that is not properly signed or witnessed can be declared invalid by a court.
Holographic wills, 100% in your own handwriting, are never a good idea. These do not require witnesses.
2. Name the right executor
Is the person you have chosen to manage your estate suitable for the job? Remember, the executor’s job is to:
• protect your estate
• probate the will and
• pay your beneficiaries.
Make sure that you have selected someone trustworthy. Handling the time-consuming tasks of an estate will not be everyone’s cup of tea.
3. Provide for spouses -common law, same sex or married
Many people misunderstand their legal obligations towards their partners. These legal obligations can include an entitlement to share in property and ongoing support.
Are you in a second marriage? You may try to leave the bulk of your estate to beneficiaries other than your spouse, typically is to children of a prior relationship. Before you make this mistake, get legal advice from a probate lawyer.
4. Consider all tax deferrals
The government allows you to defer income tax when you provide for a spouse or other dependants. If you leave a registered retirement savings plan to a spouse, the government allows you a deferral of any income tax.
If you leave $100,000 to someone other than the qualified beneficiary for the deferral, your estate could end up paying up to 50% of this amount as income tax.
5. Deal with contingencies like people not surviving you
This is one of the biggest mistakes people make in homemade wills.
They never deal with the unexpected when a beneficiary or executor dies before them. These contingencies must be covered in the will; otherwise, your wishes will not be carried out.
Ed Olkovich: Certified Specialist in Estates and Trusts Law
This information is not: financial, legal, tax, medical or psychological advice.
Always consult with a professional before taking any action.