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Five Estate Planning Tips During Coronavirus

Delwin Graham & Eric Brown - Nov 06, 2020
The COVID-19 pandemic is changing the economic and financial landscape at an unprecedented pace. If you're concerned about your own personal estate planning, there are a few key things to consider to help you prepare.

The COVID-19 pandemic is changing the economic and financial landscape at an unprecedented pace. If you're concerned about your own personal estate planning, there are a few key things to consider to help you prepare.

Read on for a list of five tips to help you navigate this trying time to protect your investments and your wealth.

1.  Update Major Life Changes

The coronavirus is prompting many people to think about their current portfolio and any major changes that may have occurred in their lives. If you've purchased a new home or sold significant assets, it's time to update your information with an estate planning expert.

Big changes in life such as marriages, divorces, new children, or a death in the family may have a significant impact on your finances. Meet with an expert who can discuss how any of these major life changes may affect you.

Your estate documents must reflect your current status, whether it's married, divorced, or whether you have had an increase in assets. These updates are crucial since they can ensure that your wishes are carried out the way you want them to be.

Think about anything in your life that may have changed since you last met with an advisor. Most of these changes are easy to make in terms of documentation, so it's best to get the information on paper as soon as possible. If you miss something, your loved ones may run the risk of ending up in a dispute over your estate later.

2.  Estate Planning and Power of Attorney

If something happens to you, who is legally allowed to manage your financial affairs? Now is the time to think about who you want to delegate financial power of attorney to.

When you give someone power of attorney, they are able to handle your finances while you're sick or even after you pass away. This important delegation should only be reserved for someone you completely trust.

Many people opt to give their children or spouse financial power of attorney. However, you can give it to anyone you like including a close friend or another family member if you choose.

To change or add financial power of attorney, you'll need to fill out a form for your specific province. Most POA forms must be signed by all parties and notarized by an official witness. With COVID-19, you may be able to do this remotely but check with your local jurisdiction to confirm.

3.  Re-Examine Your Beneficiaries

One of the most important estate planning basics is to designate specific beneficiaries who will receive your property, wealth, and other assets. Many financial institutions will let you choose someone to transfer your accounts to when you die.

This person will automatically get access to your account information, and they won't need to administer your estate through the courts. If you can change beneficiaries through your current wealth accounts, now is a great time to make some updates as needed.

When you assign a beneficiary, you'll have peace of mind knowing that everything is going directly into the right hands. This simple step is crucial at any time, but particularly during the COVID-19 pandemic.

If you want to set up a joint account, the other party will automatically be the beneficiary. Think about who you trust to handle your assets if you were to die and then update your beneficiary information as soon as possible.

4.  Consider Wills or Living Trusts

If you pass away, do you know who will get your property? A key component of estate planning is to make sure you have someone already in place who can handle transactions related to your property to keep it safe.

If your property doesn't have a designated beneficiary, it automatically transfers according to your provincial laws. Most provinces will give the property to your next of kin, or they may divide it between two siblings or other close relatives. If you'd rather determine the fate of your property, consider a will or living trust.

A will is the most common way to assign a beneficiary to your property. You can also name an executor who can handle the details of the property once you're gone. A will is easy to create, and it's an affordable way to keep your property in the right hands.

A living trust is similar to a will, except that it does not need to go through the probate process. Before you die, the beneficiary may also be allowed to manage your property if you can no longer take care of it. While a living trust is more expensive and complex than a will, it's a good option if you want to assign a beneficiary in the event that you become incapacitated.

5.  Consider a Living Will

A living will or "advance health care directive" lets you determine what type of treatment you do or do not want to receive at the end of life. If you happen to become terminally ill, it's important to have this information documented.

A living will allows you to determine your own fate including whether or not you want to be resuscitated in a medical emergency. You are able to let your family members determine whether or not to remove life support.

While it seems a bit depressing, a living will can ensure that you're able to carry out your wishes in a way that's best for you. It also makes things easier on your family since they will know they're doing exactly what you wanted.

Be Prepared for the Future

Although coronavirus is changing the way you work, spend money, and manage wealth, some proper estate planning can give you peace of mind. Consider talking to a professional about money management so that you know your assets and your health are being placed in the right hands.

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