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7 Essential Considerations for Estate Planning

Oct 16, 2020 | Estate Planning | 0 comments

Your estate includes everything that you’ve taken a lifetime to build, so it can be tough to begin thinking about how it will be managed after your passing. However, the earlier you begin this process, the better the potential outcomes may be. You can start discussing estate planning with your financial advisor at any age, stage, or level of income.

What Does Estate Planning Entail?

One common misconception about estate planning is that it’s simply dividing up property, assets, investments, and cash between beneficiaries. In reality, it’s a strategic process that often involves a team of financial professionals. This team is in place to ensure that your beneficiaries receive the positive outcomes you intend for them to have when you’re gone.

Just like in your current financial plan, estate planning requires considerations such as insurance, tax planning, and business planning. Let’s explore some of the factors that may be taken into account in an estate plan:

1. Tax Planning

One of the main goals of an estate plan is to improve or maintain the value of the estate. A significant strategy we can employ to achieve this is tax planning.

In Canada, there is no inheritance tax. However, there is “deemed disposition,” which triggers a taxable capital gain. This can be put off if the inheritance goes to a spouse or common-law partner but will be paid upon their death. This makes tax planning within an estate plan more complex. There are particular strategies your financial advisor can employ to minimize the tax burden of your estate and ensure that your estate has enough liquidity to pay taxes when necessary.

2. Projection & Division of Assets

Deciding who will receive which assets is typically the most stressful part of estate planning. You may have multiple beneficiaries and types of assets, which can make these decisions complex. A solid first step to take with your financial advisor is projecting the value of your estate. He or she can provide you with information about how your estate will grow, potential actions you can take to increase the value of your estate, and possibly even make the division of assets more straightforward.

3. Insurance

Life insurance can provide liquidity for your beneficiaries and executor to use while your other assets (such as property) may be tied up. The payout from life insurance plans can help cover immediate expenses (such as funeral expenses or taxes owed) and support your beneficiaries with an ongoing income. Your financial advisor will be able to tell you how much insurance to purchase, depending on what you would like to accomplish with these funds.

4. Philanthropic Planning

Some people choose to incorporate philanthropic giving into their estate plans. There are plenty of reasons for wanting to leave this legacy, and there may also be tax benefits that could increase your ability to meet the goals you have for your estate. Talk to your financial advisor about specific options for philanthropic giving, including which assets you’d like to provide and how and when to make the donation.

5. Business Succession Planning

If you own a business, you’ll need to consider how you can transition it successfully after you pass. This may mean selling the business, passing it on to a successor, liquidating the assets of the business, or several other options. You can start planning for a business transition or succession now.

6. Special Circumstances

No two lives are the same, and no two estates are the same. This is why people tend to need more personalized professional services when they’re completing estate planning. For example, you may have special needs children who you want to create an income or care plan around. Or, you may be going through a divorce and need to update or change your plans. In these cases, a financial advisor can walk you through strategies based specifically on your circumstances.  

7. Putting Together a Team and Strategy

In estate planning, some solutions offer more benefits than others. It’s important to know about the options available to you and the potential outcomes you can expect; after all, you need to trust that everything will be handled as you wish after your passing. In many cases, a financial advisor will build a team of professionals around your estate, including lawyers, accountants, and other financial specialists of your choosing.

Reach Out to Speak to a Financial Advisor About Estate Planning

You can book an appointment with Regan Schiller & Associates today to speak with an experienced financial advisor about your estate planning needs. We’ll help you learn more about estate planning strategies and direct you to options that fit your specific circumstances.

This is a general source of information only. It is not intended to provide personalized tax, legal or investment advice, and is not intended as a solicitation to purchase securities. Regan Schiller is solely responsible for its content. For more information on this topic or any other financial matter, please contact an IG Wealth Management Consultant.
Mutual funds and investment products and services are offered through Investors Group Financial Services Inc. (in Québec, a Financial Services firm). Additional investment products and brokerage services are offered through Investors Group Securities Inc. (in Québec, a firm in Financial Planning). Investors Group Securities Inc. is a member of the Canadian Investor Protection Fund. Insurance products and services distributed through I.G. Insurance Services Inc. Insurance license sponsored by The Canada Life Assurance Company.


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