Problems That Come Up When A Person Dies Without A Will
Risks of not having a will
A will is an essential component to estate planning. It allows you to transfer your assets to the people you want upon death. Through a will, you will decide who will inherit which assets, when they will inherit the assets, who will be the guardian for any minor children and who will be the executor of your will and trustee of the assets. It is important that you have a will prior to your passing to ensure that your assets dealt with in the manner you prefer. However, there are still many Canadians who do not have a will. When you die without a will, also known as dying “intestate”, there are many complications and risks that arise from not having a will.
Risks Of Not Having A Will
1. You Will Lose The Opportunity To Appoint An Executor Of Your Choosing.
When you die intestate, a family member has the freedom to apply to the courts to act as the administrator of the estate. If there is no family member or close friend willing to act as an executor, the court will appoint a trust company to administer the will pursuant to the Wills and Succession Act. However, it is usually the living spouse who has to deal with the burden of being an executor.
2. You Will Lose The Opportunity Of Choosing A Guardian For Minor Children Or Dependent Adults.
When choosing a guardian, there are a multitude of things you may consider: moral background, religious preferences, approach to education, political vies, family dynamics, etc. If the other parent of the child survives, then they will likely get guardianship of the child. If both parents were to pass away intestate, the judge will choose someone to care for the child. While a judge must consider the Best Interests of the Child, there will be things that they will consider in making this determination. As such, a huge risk of not having a will is not having a say in who cares for your child or dependant adult.
3. You Will Not Have The Chance To Have A Power Of Attorney Or Personal Directive
A Power of Attorney (POA) is someone who has the ability to make decision with respect to your finances and property should you be unable to make those decisions. You can also enact a POA temporarily so it is not only for if and when you become incapacitated, but also if you are out of the country and unable to make decisions due to distance. A personal directive, on the other hand, allows you to choose someone to make decisions with respect to your health and personal care. If you do not have a POA or a personal directive, the courts and doctors will determine how to care for you and your estate.
4. Your Children Could Receive Their Inheritance Before You Want.
If you are planning on leaving an inheritance for your children, they will receive the entirety of it once they are the age of the majority. Through a will, you can have your lawyer arrange a trust so that the children receive smaller amounts over a set time frame. This is a risk of not having a will because you may not want an 18-year-old to have access to a significant sum of money all at once.
5. Certain Assets Might Be Sold To Pay Off Taxes And Other Debts.
Another risk of not having a will is that if there are not enough assets to pay for your debts, your executors will have to sell certain assets in an effort to pay off any loans that you may have. In an effort to avoid having your executor make that decisions, it is best to highlight which items you want to keep in the family in your will.
6. Your Assets Will Be Distributed Based On The Rules Of Intestacy As Opposed To Your Preference.
Every province has their own rules and equations in determining the distribution of assets. Usually, the spouse will receive a portion of funds and residue of the estate. If there are descendants, then assets will be proportionately split among the children and the spouse. If there are no children or spouse, then the estate will go to the next of kin. The courts will follow a set formula and will not look at who may deserve more than the other. As such, it is best to highlight the division of your estate in your will.
7. Access To Your Assets Will Be Delayed As Your Loved Ones Will Have To Go To Court First.
When a person dies intestate, access to their assets are frozen. The courts will follow a certain standard and formula on how to deal with the assets. Creditors receive payment first after taxes and funeral expenses. Further, because your assets are frozen, your family will not be able to access your funds to pay for said taxes and funeral expenses since the bank will need a letter from the court allowing them to release funds to your loved ones.
8. You lose the ability to explain your wishes.
In establishing your will, you also have the opportunity to explain to your loved ones why you chose to give certain assets to a specific individual or why you split your estate a certain way. This will help provide them with some clarity during a difficult period of their life while also avoiding any potential conflicts amongst the future beneficiaries.
9. You Will Lose The Chance To Provide Your Burial Or Cremation Preferences.
While this is not a part of the estate, an executor has the responsibility of handling your remains. Thus, when writing a will, you detail what you would like the executor to do with your remains once you have passed. This will also prevent your loved ones from having different wishes on what to do with your remains, and prevent them from having to make a stressful decision.
Getting Help When Dealing With Intestacy
We understand the ins and outs of these emotional and difficult situations. Both of our offices’ Calgary and Edmonton, Alberta intestacy lawyers help you understand the complexities of Intestacy laws. We also help with administering an estate when there is no will and avoiding personal liability. Also learn the difference between needing letters of administration vs. a will. However, in an effort to avoid the risks of not having a will, we can also help you with drafting a will, POA and personal directive. The intestate lawyers at Kahane Law Office assist you in all matters relating estate administration. For Edmonton, please call us at (780) 571-8463 and for Calgary, please call us at 403-225-8810 or email us directly here today.