Where There’s a Will, There’s a Way to Keep Saving
Renowned English writer Dorothy Sayers once said “there is something about wills that brings out the worst side of human nature.” She was referring of course to individual family members squabbling over their inheritance, and how it can reduce them to bitter infighting. While unfortunately this does occur from time to time—mostly dependent on the family’s financial situation—for the most part a well-planned, well-organized will is a huge benefit to a family, particularly dependent children.
Consider what would occur if you were contributing to an RESP for your child and something happened to you. Without a will, the executive or administrator of your estate could have no choice but to collapse the plan and distribute the contributions equally among the estate’s beneficiaries—and keep in mind these might not be the same as the RESP beneficiary. Worse still, you could also forfeit provincial and federal grant money, which would need to be returned, not to mention the potential Accumulated Income Payments that would be included in the Estate Administration Tax.
It’s true that when you create a plan you can appoint a joint subscriber, but this can only be a surviving spouse or common law partner. What happens if you’re a single parent, or the joint subscriber is also deceased? A great thing about RESPs is that you can name a successor subscriber to continue contributions in the event of your death, And that requires a will. Should you already have a will, but have yet to name a successor beneficiary, the process couldn’t be simpler: most lawyers store wills electronically, so they can easily prepare and sign a new will with the added clause for a few hundred dollars. Is that worth the piece of mind it will bring? I sure think so.
As a father of three, I always want to be there for my children, but I also realize there will come a time when I won’t be around. Hopefully that will be far into the future, when they’re able to support themselves and have families of their own. But if it isn’t, I want them to be provided for. It’s not a subject we like to think about, but it’s something that weighs on the mind of every Canadian parent. Amazingly, though, recent statistics show that almost one-third of Canadians between 45 and 64 don’t have a will.* The good news is, I have something to help them get started.
As a gesture of thanks to our loyal subscribers, we’ve recently developed a new value-added service: the Heritage Will Kit (if you’re a subscriber, just sign in here to access yours). It’s a comprehensive guide to planning your estate the right way. It’s straightforward and easy to follow (i.e. you won’t need a law degree to understand it), and I urge anyone who hasn’t yet created a will or is still on the fence to please give it a thorough read-through; you may be surprised at how simple the process can be. And, better yet, it’s absolutely free for you to download and use!
Have you created your will yet? Are you thinking about it, but haven’t gotten around to it?
Until next time,
Start Early. Save Often. Stay Invested. ™
*Source: Harris/Decima poll, 2012