Over the last months some clients and parents of clients have died. This is undoubtedly a difficult time that is made harder by the estate administration that falls on the survivors. Even if the deceased’s affairs were well organized there is still a maze of steps to get through. I wanted to pass along some observations and thoughts on how to make the distribution process easier.
Meet Their Financial Professionals: Meeting your spouse’s or parents’ banker(s), financial advisor(s), insurance agent(s), business partner(s) and accountant(s) when everyone is alive and competent can help create a relationship during a benign period. If the time comes for a difficult phone call both parties will have a personal point of connection to start from. In the context of parents, be sensitive and patient – it may be a fine line between giving off the impression of intrusiveness and preparedness.
Make a List of Financial Items & Relationships: I’ve spoken before about creating a list of your financial affairs which include a list of contacts (See “Don’t Forget to Make a List”). This can serve as a checklist for the executor and can save them a step. Many executors have told me that a master ‘to do’ list allows them to tackle one conversation each day.
Check Your Will & Powers of Attorney: I often talk about a will or powers of attorneys as living documents. This is because life changes and your legal documents need to evolve with it. One example I often see is out-of-date executors or powers of attorney. Often a named individual is dead or now living in another province.
Consider Joint Chequing Accounts: Even in incapacitation or death, many bills may still need to be paid. Consider adding a trusted child to your chequing account to allow them the opportunity to monitor your balance and make any necessary payments. None of us would want the city pestering our parent about unpaid property tax if they were in the hospital.
Simplify & Consolidate: On someone’s death, a beneficiary or executor may feel the distribution of assets is straightforward and can be done quickly. This can be the case but if the deceased had a handful of financial assets at different institutions it can take time. That could be months for a partial distribution and years for a full distribution if there are assets tough to sell or hold an unknown tax liability. This rarely applies on the death of the first spouse as assets rollover to the survivor easily. It is when assets are going to the next generation that patience should be applied. Reducing the number of financial relationships can make this process more straightforward and manageable.
Feel free to give me a call if you have any questions.
Bryan
