Estate trustee – Me? Please help me!

BY ANDREW STEWART

If you’ve read any financial articles or listened to any business television and radio shows over the last 10 years, you may have heard about the “Greatest Slow-Motion Demographic Transfer of Wealth in Canadian history.” At this point, you’re probably thinking what this has anything to do with me? Or how does this even affect me? Well in simple terms, it has to do with when a large number of people were born, and at what age will they start to die and transfer their wealth down to the next generation. The baby boomer bump was from 1947 to 1967, but the surge in births actually started in 1937. So that means every person born in 1937 turned 80 years old in 2017. So if your parents are around that age, you or a sibling might be named as their estate trustee.

Based on surveys and statistics it is estimated that 70% of Canadians are without a current and valid will. Also, the percentage of Canadians appointing a family member as their estate trustee is 98%, it seems we are looking at this as a DIY job. Amazingly from past trustees surveyed, 47% reported administrative complications, 31% reported emotional issues and 26% reported legal issues. What I’m trying to get across is if you are the estate trustee or know someone who will be, do you know what you’re getting into and how to handle it?

At first, you might be flattered at being named estate trustee, but that’s just your ego talking. Losing a loved one brings on a flood of different emotions; disbelief, anguish, loss, fear, shock, grief, and an overwhelming sense that our world has suddenly and permanently changed. A common question that grips each of us is, “what do I do now?” Can you perform the most immediate tasks following the death of a loved one? A trustee has a fiduciary duty, which means they must always act in good faith and with loyalty.

Funeral arrangements: Understanding the myriad of decisions involved in celebrating the end of life and the importance of ensuring the success of this one-time-only event for a diverse group of grieving loved ones. The funeral is often a difficult and emotional time for many and comes with challenging economic choices as well. Trustees discover they may be required to make decisions on matters they might never have had to deal with in the past and this, for many, will be their first foray.

Notifications: Who needs to be informed? Friends, family and extended family come to mind quickly, but there are actually far more people and organizations that need to be informed over the weeks and months.

Government benefits: Some people rely on government benefits to support them when a primary-earning spouse dies, and the limitations can be upsetting. Understanding the types of government benefits, how to apply and what documentation is necessary will be important. CPP death benefit, CPP survivor and children’s benefits, veteran’s benefits, old age security, the impact of disability, notification to cancel OAS benefit as well as the taxation of benefits to name a few.

These are just some of the items an estate trustee has to think about and execute on. The accountability is not just on the trustee but also on the parents and testators. Get informed and be prepared ahead of time…