TORONTO, ONTARIO--(Marketwire - Oct. 17, 2012) - BMO Harris Private Banking today announced the results of an estate planning study which examined Canadians' intentions and expectations for their wills. According to the study, more than half of Canadians (56 per cent) have a will.
As for who stands to benefit from those who currently have a will, the study revealed that an average of 85 per cent of the wealth of Canadians with a will is going to remain in the family:
- Sixty per cent of assets are designated to children
- Twenty-five per cent of the assets will go to other family members
- Three per cent will go to friends and charities, respectively
"These results reflect the strength of the family unit in Canada," said Sara Plant, Vice President and National Director, BMO Harris Private Banking. "It's clear that Canadians are looking beyond having enough funds for their lifetime. They place great importance on leaving a legacy and planning financially for their family's future."
Among parents whose children are in their will:
- More than two-thirds say their children's inheritance will be held in trust until the children reach a certain age, with one-third placing that age between 22 and 30
- More than half of children (53 per cent) will receive their inheritance in one lump sum
The study shows that almost a third of children know they are included in their parents' will but do not know exactly what they will receive. Meanwhile, 17 per cent are not aware that they are in the will at all.
"Not only is it important to draft a will, but it's also essential to communicate your wishes to your family," added Ms. Plant. "While it doesn't have to be about the specific details, Canadians need to do a better job of talking about estate planning issues with our loved ones in general."
Other key findings:
- Sixty per cent of Canadians without a will intend to draft one in the future
- More than one-third cite "a general need to plan for the future" as a reason to draft their will
- Forty-eight per cent of Canadians have assets held in 'joint ownership' as part of their estate planning strategy
BMO Harris Private Banking offers some things to keep in mind when drafting a will:
Consider the timing: Draft a will as soon as you own assets or start a family. If you are thinking about leaving money to your children, consider whether they will receive it all at once or over time.
Your choice of executor is important: Settling an estate can be complicated and requires knowledge of tax, inheritance and family property laws. There are close to 70 separate duties that must be carried out - more if the estate is complex. Before drafting a will, choose who will manage your estate, such as a relative, friend or trust company. The latter can complete the numerous required tasks on the executor's behalf, keeping them informed every step of the way. This service is particularly useful for executors who live far from the estate for which they are responsible.
Keep talking: Communicate with your immediate family so that those who will be impacted by your passing will know the plan. Share the overall theme of the will, but not necessarily the dollar amounts since they could change over time.
Review Regularly: While it is a best practice to review your will every time you file your taxes, most people revisit their will when there is a life change such as new assets or new people that might impact your estate planning; typically, this happens every seven to 10 years. Take that time to make sure your wishes are in place and seek professional assistance to make any necessary amendments.
For more information on estate planning, please visit: www.bmo.com/estate.
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The survey conducted by Pollara was completed between September 18 and September 24, 2012 with a sample of 1,004 Canadians 18 years of age and older. A probability sample of this size would yield results accurate to ± 3.1%, 19 times out of 20.