Many of our Wills & Estates clients are troubled by one question: when should I set up my will? If I set it up too early, what if my life changes later on? It seems too much trouble to be constantly updating my will, I might as well wait until I am much older.
There is 2 problems with this type of thinking:
- you never know when accidents will befall you – and if you pass away unexpectedly without a will, your beneficiaries will have to go through the lengthy and agonizing process of probate without a will;
- you must be able to think independently and clearly at the time of making your will – if not, then you do not have capacity to draft a will – thus, we do not suggest that you wait until you are much older or seriously ill.
Regarding the constant updates, Sabrina – experienced lawyer at Varity Law, have a great solution. There are only 3 types of situations in which you need to update your will: (1) changes in executor (2) changes in beneficiaries (3) changes in asset types or distribution wishes.
All other details, such as the addresses of your real estate properties or the account numbers of your bank accounts, do not need to be in the Will. Those details you can simply record down on a separate, informal piece of paper for your executor to follow.
Today, we will briefly explain the 3 types of situations that do require you to update your Will:
Changes in Executor
Executor or Estate Trustee is the person who distributes your estate. After one pass away, their executor will set up an Estate Account at the bank. The executor becomes the only signing officer of this estate account, and can control all the money that goes into the account, and all the money that comes out of the account. By law, they are supposed to follow your will instructions or if there’s no will – estate legislation instructions. However, there is no one to oversee their actions other than the beneficiaries. Due to this, it may be a good idea to set your executor and beneficiary as the same person, to avoid a conflict of interest.
The executor does not need to participate in the Will signing appointment, but they must agree to act as executor when the time comes. Hence, if your executor unfortunately passes away, or your executor decides he/she does not want this role, then you would need to update your will to choose a new executor.
Changes in Beneficiaries
Beneficiaries are the people who receive the estate. After the executor paid off all estate debts and filed all taxes, then they can distribute the net estate to the beneficiaries. Although beneficiaries may be under the age of majority, it does create problems during distribution if they are minors. Certain type of assets, such as real estate, cannot be owned by a beneficiary until he/she reaches 18 years old. Thus, before that, an attorney for property must be appointed, who will manage the estate for the beneficiary until they reach adulthood.
Hence, if a beneficiary unfortunately passes away, or if a beneficiary is fortunately born, then you would need to update your Will.
Changes in Asset Type or Distribution Wishes
Often, different types of assets are distributed in different ways. For instance, to transfer a real estate deed, you must do so through a real estate lawyer (Varity Law can help); to pass on funds in a bank account, the executor must go talk to a bank manager; and to inherit corporate shares, a corporate lawyer would need to update the corporate documents (Varity Law can help).
Estate lawyers should avoid drafting Wills that may conflict with the ownership information listed on various assets. For example, if the real estate deed says John and Mary are joint tenants to the property, then the Will should not say after John passes away, the property goes to Susan instead. Rather, the Will can say it will first pass down to Mary as she is a joint tenant, and then it goes to Susan if Mary is no longer here.
Therefore, if your asset types have changed – for instance, you did not have real estate or corporate share before, but now you do – then you would need to update your Will.
Other Details You can Update Yourself for Free
Other details, such as property address update or bank account number updates, do not need to be recorded on the Will.
Nevertheless, the executor would still need that information to ensure a smooth distribution. Think about it this way, the Will typically say that all real estate properties and all bank accounts under your name goes to your wife Cheryl. But what if the executor does not know what constitutes “all your real estate properties” or “all your bank accounts”?
The solution is simple. At Varity Law, we provide our Wills & Estate clients with a simple form they can complete on their own regarding those details. This is an informal form that they may update themselves without a lawyer’s involvement. In addition, the details on those forms can be kept completely private and disclosed only to the executor and the beneficiaries.
Conclusion
In summary, you should update your will when there is a change in your executor, in your beneficiaries, and/or in your asset types and distribution wishes. Other details do not need to go on the Will and can be separately recorded on an informal form that is only revealed to the executor and beneficiaries. Those details may be updated at any time and for free by yourself.
Thus, we strongly encourage everyone to complete their Wills as soon as possible, to avoid putting your beneficiaries into a situation where they must suffer through the agony of probate without a will.
We hope this article addressed many of your Wills and Estate questions, and here is to wishing everyone a long life filled with happiness and love.
This article is meant to provide general legal information, not specific legal advice that would fit your unique situation. For your specific questions, we invite you to book an initial free consultation with us by calling 905-597-9357 or emailing hello@varitylaw.ca
