It seemed there was nothing her father couldn't do when Margaret was growing up. He was the most capable person she knew. Widowed by the time he was 55, he lived an independent and full life, never relying on Margaret for anything other than her company.
Your estate is everything you own today - your home, savings, investments, life insurance and personal possessions. So, no matter where you may be on your financial journey, you have an estate that needs protecting. But how you approach this plan is important.
With the average price of a home in Canada 1 costing roughly $530,000 in 2020 , it's getting harder for first-time buyers to enter the market. This is likely why a growing number of parents are stepping up to help their adult children purchase a home. While it's admirable to offer this level of support in an increasingly expensive world, it's also a complex decision that both parents and their adult children should ponder carefully.
Recently retired Ross and Penny have an estate planning challenge. They've accumulated a comfortable net worth, with a good portion of it in liquid investments. They plan to leave everything to their three adult children, but they also want to help them financially right now. The problem is that all of their children have a different relationship with money than Ross and Penny. In a nutshell, the parents are savers and the children spenders. If they give large sums of money, Ross and Penny would want their children to use the cash to improve their financial lives. Would they do that?
Your death will create problems. There will be three types - emotional, legal and financial. You can do certain things now, while you're alive, to reduce or increase these problems and make your heirs either love you or hate you.
You can increase the emotional upset after your death by leaving your affairs in a mess. Hide your will, or better still, don't make one. Have a number of secret bank accounts and investments.
Recently, a client wanted to leave all of their money to two charities through their Will. They wanted to leave a legacy to a couple of charities that were close to them and they didn't have any close family members.
Here is her situation: Age 80, $550,000 in savings (75% non-registered and TFSA), with income of $70,000 annually from pensions and RIFS while living in an upscale retirement residence. She was also spending an additional $20,000 a year from savings to support her lifestyle.
The Baby Boomers are making history as the largest retirement migration ever seen. However, it's their parents who hold the most massive accumulation of wealth which is now being transfered to future generations. Estimated to be well in excess of a trillion dollars, the traditional rules of inheritance are changing.
Wealth transfer can be a complex process for most families but especially wealthy ones. The range of issues involved can include family values, objectives and relationships; business continuity; investment strategy and insurance, taxes and ownership structures, amongst others. At the same time questions of control, responsibility and timing are raised.