1. Consider the family history when planning your estate – especially blended families
Your family has had a lifetime to build their relationship – and you should consider it when you planning your estate. If you treat siblings unequally in the will without reason, it may lead to resentment, alienation, and litigation. If there is a reason for unequal treatment, such as gifts or loans during your lifetime, it’s a good idea to document it carefully. If you have made gifts or loans to one, and the other(s) know about it, you should consider dealing with that too.
Blended families are often fraught with friction, between spouses and offspring from different marriages. The size of the estate, and how and when it was amassed may further the conflict. Careful estate planning can reduce the likelihood of litigation.
2. Avoid a property war
Many families have prized possessions – a cottage, grandma’s rocker, the armoire lovingly built by Dad. Sentimental property can create a lot of stress and fighting – consider gifting specific items to specific people, or including a clause that if the beneficiaries can’t agree, everything will be sold.
3. Remember the Wills Variation Act
The Wills variation Act allows spouses and children (but not step-children) to challenge the provision made for them in the will of the deceased. If a person fails to make adequate, just and equitable provision for a spouse or child, the Courts will consider fully consider the circumstances and may vary the provisions under the Will.
If you wish to disinherit a spouse or a child, you should get legal advice on how to document your wishes.
4. Consider how your assets are held (and beware joint tenancy as a tool)
First of all, make sure you know if you hold your assets in joint tenancy, or as tenants in common with others. In general, joint tenancy means that the survivor inherits the asset outside the estate.
Many people mistakenly believe that by holding their assets in joint tenancy with another person, they can avoid probate and litigation. Over the past few years we have seen an increase in litigation to determine whether a gift to the survivor through joint tenancy was truly intended by the deceased, or if the survivor holds the interest of the deceased “in trust” for the estate. So if your intention is to gift the asset upon death, it is important to document it properly.
5. Avoid challenges of incapacity or undue influence
If there is any concern about your health, you may want to get a doctor’s opinion regarding your capacity to make a will. Dramatic changes in the contents which surprise beneficiaries (or former beneficiaries) can fuel suspicion in your beneficiaries (or former beneficiaries) that you either lacked capacity or that you were subject to undue influence.
6. Make sure someone can find your will!
Keep it in a safe place and in British Columbia, and register its location with the Vital Statistics Agency.
7. Beware the Home-Made Will
Home-made wills may lead to your estate being distributed differently than intended, through inadvertent mistake – for example, a gift of your RRSPs to one child and the residue of your estate, before taxes to another, may appear to have the same value to each, but may actually have a very uneven result once the taxes are paid. A homemade will may not comply with the formalities required by the Wills, Estates and Succession Act and be invalid – and the intestacy provisions for dying without a valid will may be very different from what was intended. If litigation ensues, the legal fees will outstrip the cost savings of not having a professional prepare your will.
8. Choose your Executor carefully
Choose your executor carefully. You want someone who is diligent and can be even-handed; if you are thinking of choosing two of your adult children who do not get along now, they will likely not get along as executors and problems will follow. In high-conflict cases, a professional executor may be a better choice. You should also consider setting out what compensation your executor should receive.
9. Review your will regularly and especially after large life changes
Life doesn’t always go as one might expect – if you have a large life change, such as a separation, a tragedy, or a large inheritance, you should seek legal advice and reconsider your estate plan.
10. Avoid surprises
Many families, and especially blended families, can avoid a lot of problems by discussing the estate plan early. If the family already has conflict, consider having a trained mediator facilitate the discussion.