Recently my father passed away and what my sisters and I faced during our time of mourning made me realize that even with the best of intentions of estate planning, more often than not it falls short. Some days it seems non-existent.
I wrote this to-do list for my friends to give to their parents and thought I would share it here with the hopes that it might help someone. I am not an attorney or accountant so please know, this is just from my personal experience and is not intended to be construed as professional advice,but here goes.
My father beat the odds countless times when it came to dying. This revolving door through emergency rooms gave him plenty of time to visit and revisit his efforts in estate planning. But even with his reflective time in various hospital beds, (Mt Sinai is the best by the way), it wasn’t until this past year and actually hiring a professional that we saw the gaping holes in his existing plan.
You see, my dad was of a certain generation and...frugal, likely not unlike yourselves or your parents. He was extremely accomplished and did everything himself, so why stop at banking, legal or estate-planning strategy. With some initial legal help in the 80’s as a framework, online tools and google know-how, he felt he had tackled the lists with aplomb. And truthfully, he did a great job, but unfortunately without being there to defend his intentions, some of them were…well…questionable.
a. Just make sure it aligns with your bank’s version of what they want to see. Yes. The banks. If you bank with one of the major banks, just ask for their version and base it on this. They have one.
b. Please include a clause that allows for gifting. THIS IS A MAJOR POINT. Obviously I’m assuming your kids aren’t hovering over your deathbed with gleeful energy, but if the POA is ever triggered and you don’t have that, it can make even your most assumed gestures of Christmas gifts to the grandkids impossible. IMPOSSIBLE!
2) RRIF & TFSA ACCOUNTS – LIST BENEFACTORS – AGAIN with the banks (are you seeing a trend?).
I wrote this to-do list for my friends to give to their parents and thought I would share it here with the hopes that it might help someone. I am not an attorney or accountant so please know, this is just from my personal experience and is not intended to be construed as professional advice,but here goes.
My father beat the odds countless times when it came to dying. This revolving door through emergency rooms gave him plenty of time to visit and revisit his efforts in estate planning. But even with his reflective time in various hospital beds, (Mt Sinai is the best by the way), it wasn’t until this past year and actually hiring a professional that we saw the gaping holes in his existing plan.
You see, my dad was of a certain generation and...frugal, likely not unlike yourselves or your parents. He was extremely accomplished and did everything himself, so why stop at banking, legal or estate-planning strategy. With some initial legal help in the 80’s as a framework, online tools and google know-how, he felt he had tackled the lists with aplomb. And truthfully, he did a great job, but unfortunately without being there to defend his intentions, some of them were…well…questionable.
So here is the list, and please, I beg of you, just try to tackle these three if no others.
1) POA – Power of Attorney - have two in total - one for health and one for property. Great!
a. Just make sure it aligns with your bank’s version of what they want to see. Yes. The banks. If you bank with one of the major banks, just ask for their version and base it on this. They have one.
b. Please include a clause that allows for gifting. THIS IS A MAJOR POINT. Obviously I’m assuming your kids aren’t hovering over your deathbed with gleeful energy, but if the POA is ever triggered and you don’t have that, it can make even your most assumed gestures of Christmas gifts to the grandkids impossible. IMPOSSIBLE!
2) RRIF & TFSA ACCOUNTS – LIST BENEFACTORS – AGAIN with the banks (are you seeing a trend?).
If you have a benefactor other than your spouse in mind, you MUST have them listed on the account.
Even if it’s your spouse, list them. It is not enough to have it listed in the will. The BANKS MUST BE AWARE AND HAVE DIRECTION. It is not time consuming at all, but it makes something that is already a time-consuming task riddled with issues and taxes if you do not. Now that that is done, tremendous! Just make sure your benefactors are aware that the money will be released to them PRE-TAX so they need to account for that before counting their eggs.
3) The BANKS
You, your spouse, your executors, your lawyer, your accountant and possibly your investor, literally get LOCKED OUT of the accounts as soon as you notify them of a passing. You become blind to any and all stock portfolios and it feels insane. Take the time to organize everything and take screenshots of every account, every bill payee (this one I still kick myself over), and get every statement you can print prior to notifying the bank. The banks are there to ensure no fraud takes place, which is great, but it feels like they go from friendly cashier to nefarious bank owners from Mary Poppins. I read this stat recently that over half of widows leave the investor their spouse had in place after things settled. Having experienced the agony of this process I have a feeling I know why. The real tragedy is that while you are processing some of the darkest days, you are taxed, tapped and drained of all levels of patience and energy all sealed with a, “sorry for your loss” sign off. It has been “a special form of hell”, as my sister so aptly put it, and I just want you all to avoid it as muchas possible.
Those are the BIG THREE. Please, Please, PLEASE heed my warnings.
3) The BANKS
You, your spouse, your executors, your lawyer, your accountant and possibly your investor, literally get LOCKED OUT of the accounts as soon as you notify them of a passing. You become blind to any and all stock portfolios and it feels insane. Take the time to organize everything and take screenshots of every account, every bill payee (this one I still kick myself over), and get every statement you can print prior to notifying the bank. The banks are there to ensure no fraud takes place, which is great, but it feels like they go from friendly cashier to nefarious bank owners from Mary Poppins. I read this stat recently that over half of widows leave the investor their spouse had in place after things settled. Having experienced the agony of this process I have a feeling I know why. The real tragedy is that while you are processing some of the darkest days, you are taxed, tapped and drained of all levels of patience and energy all sealed with a, “sorry for your loss” sign off. It has been “a special form of hell”, as my sister so aptly put it, and I just want you all to avoid it as muchas possible.
Those are the BIG THREE. Please, Please, PLEASE heed my warnings.
Francesca Slocombe