When Should You Review/Amend Your Planning Documents?

At this difficult time, with all of us isolated for so long and the constant threat of contracting COVID-19 ever present, the members of the Aird & Berlis Estates and Trusts Group are contacted daily by existing clients, as well as new ones.

Many people are soberly reflecting on their own circumstances. Fearful of being exposed to infection, illness and, from the statistics forced upon us daily, death, there is a great deal of internalizing about what would happen to their family if they were stricken.

We are sure that many of our readers will want to ensure their planning is up-to-date. For our readers who are advisors, it is important to ensure that your clients' planning is also up-to-date. To that end, we have produced a weekly series of Alerts which will provide basic information in response to questions we are frequently asked.

Last week we looked at what happens if you die without a valid will. To read the Alerts from our previous weeks, please see the links below. 

Now let's get to this week's question:

When Should You Review/Amend Your Planning Documents?

Having made your will(s) and power(s) of attorney, it is unwise to forget about your planning.

Circumstances naturally change for everyone. Having “out-of-date” planning documents can be as disastrous as having none at all. Keeping those documents “up-to-date” is as important as originally creating them.

You must remember:

1. Unless a will specifically states that it was made in contemplation of marriage to a named individual, marriage automatically revokes your will(s). But, divorce does not. However, gifts in a will to a divorced spouse are revoked. So is the appointment of that former spouse as executor, unless the will specifically states to the contrary. Separation does not revoke a will, nor gifts in it to a spouse.
2. Beneficiary designations inserted into your will for any registered investment plans (i.e. RRSPs, RRIFs and TFSAs) or insurance policies only apply to plans or policies that are in place on the date your will is executed.
3. Lack of mental capacity will prevent you from making, revoking or amending a will or power of attorney.

It is always recommended that you review your estate plan every five years to decide if it requires an amendment. In any event, you should consider amending your estate plan if:

• your marital status changes;
• the named executor, trustee or attorney dies, becomes incapable or unsuitable to act, or ceases to be a Canadian resident for tax purposes;
• there are births or deaths in your family, especially if directly connected to a beneficiary;
• you have disposed of property that was subject to a specific gift in your will;
• the nature or value of your assets changes materially;
• you leave Ontario and take up permanent residence elsewhere;
• you acquire assets in another province or country;
• a named executor, trustee or beneficiary changes his or her name; or
• if the health or circumstances of a named beneficiary change.

Originally published by Aird & Berlis, October 2020

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.