Financial expert Christopher Liew warns that a valid will is useless if heirs cannot locate it or understand the underlying assets. His advice highlights the critical need for physical documentation and digital access to prevent chaos during the grieving process.
The legal necessity of physical signatures and paper wills
Estate planning is often treated as a one-time event rather than an ongoing process of communication. While many Canadians recognize its importance, a significant portion of those working with financial professionals have never actually discussed the topic with their advisors. This gap in communication creates a systemic risk where even well-intentioned plans fail due to a lack of accessibility.
According to Christopher Liew, a CFP and CFA Charterholder, the rise of online will platforms has created a false sense of security. While these tools are useful for drafting, they often fall short of legal requirements in most provinces. To be valid, a will typically must be printed, signed, and witnessed on physical paper, meaning a digital file alone may not suffice when an executor needs to settle an estate.
Tracking the 2009 pension and hidden GICs
A major hurdle for executors is the discovery of "hidden" wealth that was never formally disclosed to the family. Most people are aware of primary residences and main chequing accounts, but secondary assets often slip through the cracks . This includes older pensions from jobs held decades ago, such as a position from 2009, or GICs held at secondary banking institutions.
To mitigate this, Liew suggests creating a one-page inventory that acts as a map for the executor. This document should list every institution, account type, and debt, along with contact information for accountants and lawyers. the report notes that this inventory does not need to include specific balances or passwords, but it must provide a clear path to finding them.
The CRA's capital gains trap and the $5,000 benefit
Death in Canada can trigger significant financial obligations that catch families off guard. Under the rules of the Canada Revenue Agency (CRA), a deceased individual is treated as having sold all their capital property immediately before death. This "deemed disposition" can result in a heavy capital gains tax bill on the final return, potentially forcing families to sell cherished assets to cover the costs.
However, there is some relief available through government benefits. The CRA may pay an estate between $2,500 and $5,000 for deaths occurring on or after January 1, 2025, provided the executor applies within 60 days. Additionally, surviving spouses may qualify for the Canada Pension Plan (CPP) survivor's pension, though these funds are not distributed automatically and require a formal application to Service Canada.
The digital barrier of the smartphone lock
Modern estate planning must account for the fact that much of a person's life is now secured behind digital encryption. If an executor cannot unlock a smartphone, they may find themselves locked out of banking apps, email accounts, and investment platforms . This digital wall can stall the entire probate and distribution process.
Liew recommends using a password manager with an emergency access feature or keeping written instructions in a physical folder. Ensuring that the digital keys to a person's life are accessible is just as important as the legal documents themselves.
The missing link in executor preparedness
While the advice provided offers a strong foundation, several practicalities remain unaddressed. It is unclear how families should manage assets held in complex legal structures, such as private trusts, which may require more than a simple one-page inventory. Furthermore , while the source mentions the new CRA death benefits starting in 2025, it does not specify if the application process will be streamlined or if it will add further administrative weight to an already burdened executor.
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