7 common will and estate planning myths debunked

An ‘estate’ is a legal term used to describe everything you own (money, property and personal items) and owe others, at the time of your death.

More than just a will, an estate plan includes a number of documents to help protect your assets and legacy. Estate plans can help prevent your family from having to make difficult choices about your estate when they are grieving. Dive deeper into wills, estate planning and common myths around both with Certified Estate and Trust Administration professional Sara Azad from Willful, one of Canada's leading online estate-planning platforms. 

An estate plan is a set of legal documents that outlines in advance what will happen to your assets (or “estate”) and dependants after you pass away (or if you become incapacitated, due to a car accident or stroke, for example).

Your complete estate plan has several components, including a will, power of attorney documents, and more. 

Your last will and testament (commonly referred to as a will) is a legal document that outlines how you wish to distribute your assets, such as property, money, or heirlooms, as well as who should care for any minor children or pets after you die. Your estate includes all of your assets at your time of death — which includes anything you possess of financial or other value.

Your will is also where you:

• Name your executor, who will be in charge of managing your assets and settling your affairs on your behalf
• Designate beneficiaries for inheriting assets
• Name guardians to take care of your dependent children or pets
• Designate any charitable gifts to causes or organizations you support
• Outline your funeral and burial wishes

Who would you want to take care of your health needs or medical decisions if you were unable to do so yourself? If you were out of the country and needed someone to pay your bills for you, who would you appoint?

A power of attorney (POA) allows you to choose someone you trust to make decisions for you if you ever become medically incapacitated and unable to communicate or manage your affairs.

As your attorney, this person would make decisions based on wishes you have outlined in your personal directive or power of attorney documents.

Depending if they are your attorney for personal care or your attorney for property, this person would have the ability to make medical and personal care decisions for you, or manage your property and finances, respectively.

Unlike a will, a power of attorney’s authority only comes into effect while you’re still alive, either under specific circumstances (like if you were to fall into a coma becoming medically incapacitated) or after the document is executed (in the case of some power of attorney for property documents).

By making power of attorney documents, you decide who takes care of you and your assets and what your care looks like. Without these documents, the government decides who your substitute decision maker for medical decisions is, and no one can access your financial accounts unless they’re a joint owner with you on your account(s).

Now, let’s address some of the myths you might have encountered, or believe, about estate plans in Canada.

Estate planning is important for adults of all ages because unexpected events can happen to anyone. Having a plan in place helps you make sure your loved ones and dependants are looked after (through your will), and that your wishes about your health care and property are honoured (through your POAs).

Having an estate plan is especially important for those with dependent children or pets. A will allows you to choose guardians for your children instead of leaving it up to the government to decide who will care for them. It also allows you to choose guardians for any pets, and leave behind funds to manage their care if you choose.

Powers of attorney are vital if anything happens to you, leaving you unable to make medical decisions for yourself.

• Having an attorney for personal care ensures decisions are made faster, your wishes are honoured, and your care is prioritized.
• An attorney for property can also make sure your bills are being paid, and your family is taken care of during any medical emergencies.

Many Canadians delay getting a will because they believe they’ll need to visit a lawyer, which will be expensive. While it’s true that a lawyer-drafted will can cost thousands of dollars when you factor in the initial will creation plus updates down the road, it’s a myth that wills have to be expensive and must be created by a lawyer.

You don't need a lawyer to make a legal will in Canada. Some common ways to create a legal will in Canada include using an online will platform or do-it-yourself will kits. 

If you decide to create your will online, you must meet the following requirements for your online will to be legal:

• You must be the age of majority in your province – The age at which you’re allowed to make a will varies across provinces. Certain jurisdictions allow minors to create a will if they have been married, have children, or have a common-law spouse.
  
  
• You must be of sound mind – You are of rational mind and aware of what you are doing.
  
  
• You must sign your will with a wet signature (i.e., using pen and ink on paper) – A typed will must be physically printed and signed on paper with ink at the end of the document by the testator (you, the maker of the will). Only the printed and signed version of the will is legally recognized. The only exception to this rule is if you’re in British Columbia, which allows residents to sign, witness and store their wills completely online.
  
  
• Your will must be signed by two witnesses after you sign it – Your witnesses cannot be beneficiaries of your estate. Note that the signature or the acknowledgement of the signature by the person making the will must come before the signature of either witness.

Passing on money and property is just one of the many reasons to have a will.

Even if you feel you don’t have much in terms of assets or money, a will allows you to:

• Appoint an executor who will take care of your estate
• Assign a guardian to look after any minor children or pets
• Outline your funeral/burial wishes

It’s also important to have a POA for property and a POA for Personal Care in place regardless of your level of wealth. If you become incapacitated and no one has been appointed to these roles, timely decisions will be delayed until someone is appointed, which could have an impact on your health and or financial situation.

If you have children and die intestate (i.e., without having made a will), intestacy laws  may divide your estate between your spouse and children rather than leave everything to your spouse. In a will, you can indicate how your estate is to be divided among your loved ones.

If you’d like to leave assets to your children, your will can specify the age at which they’ll inherit the assets (for example, when they turn 18). This may help to ensure they are more mature and responsible when they receive their inheritance.

Without a will, family members may be unclear and disagree about your wishes. In your will you specify what happens to your estate and provide guidance about your funeral and burial preferences. This will help your family ensure your wishes are met. 

Even holographic wills, which are handwritten wills made without any machinery or witnesses, have specific requirements to make them valid. Certain provinces, including BC and PEI, do not recognize holographic wills.

Since these wills do not have witnesses, it needs to be sufficiently proven that you wrote the will and that you did not write it under pressure from anyone else.

It’s recommended that you review your estate plan every few years to check whether your assets or wishes have changed.

This is important because:

• You may have a spouse or a child who isn’t yet included in your will
• You may have purchased property or a house since creating your will
• You may have moved to a new province or country
• Someone named in your estate plan may have passed away or no longer wishes to take on their role as executor, guardian, beneficiary, or attorney
• You may want to remove someone from your will

Ready to create your will and power of attorney documents? Visit Willful’s secure online platform to get started.

Scotiabank is proud to have teamed up with Willful, which makes it simple, convenient, and affordable for Canadians to make a will and other important estate-planning documents online.