Wealth Transfer

Inevitably the day comes for us all when it is time to pass on the wealth we have accumulated in our lifetime – we know that in the end we can’t take it with us. However, we know that if we don’t plan properly it is possible that the government could take a good portion of our wealth or our wealth could be distributed in a way that we would not have chosen.

There are many things we can do to ensure that our estate is handled as we want it to be, and there are ways to reduce the tax liability or at least potentially the cost of paying the government.

Wealth Transfer:

Ultimately, we reach the end of our lives and what we have will be transferred to others. Sometimes estates have been tied up in legal battles for decades and at extraordinary expense. Planning ahead of time for this transfer can make the process easier, quicker, potentially with less tax and other expenses.

There are a number of things that can be used to assist in the transfer of one’s assets or estate. We will touch on a few below.

Estates and trusts

  • Even if a person has a significant amount of assets it may be possible for them to not have much if anything of an estate. A number of things bypass the estate and therefore it is possible to really not have much in an estate. Insurance contracts including segregated funds with named beneficiaries other than the estate should bypass the estate. Similarly, registered accounts such as RRSPs, RIFs, TFSAs, RESPs, RDSPs, etc where the beneficiaries are not the estate should bypass the estate. Also, joint trusts with rights of survivorship should also allow for bypassing the estate.
  • There are many types of trusts that can be set up to achieve special purposes. Living trusts can be set up while and settlor is alive or a testamentary trust can be established upon the death of the settlor.
  • Trusts can be a very useful tool in a variety of financial planning, estate planning and corporate structuring applications.
  • Consult with your qualified financial planner to discuss the use of a trust in your financial and estate planning applications. A qualified financial planner will be able to refer you to a legal professional to assist with setting up a trust if applicable for you.

Alter-Ego Trusts

  • Alter-Ego trusts are a newer form of trust where a person has to be 65 years of age to qualify to have one.
  • They can be quite useful in allowing for the protection of assets and the ultimate transfer of assets.
  • Discuss Alter-Ego trusts with your qualified financial planner if you have a situation where you need to keep things out of probate, or potentially would like to restrict the amount being left to preferred beneficiaries, or need to make provision for the care of others after your death.


  • Death is certain and having a will will make it much easier for those left behind to sort out your estate.
  • Your will directs what is to be done with your estate and who you appoint to act as the executor to handle the management of this process. Your will also allows for the appointment of a guardian or guardians for any minor children.
  • Dying without a will or intestate can create complications especially when minor children are involved.
  • We recommend discussing your will with a qualified financial planner who will be able to refer you to a legal professional to have a will completed. We also suggest considering having a Power of Attorney and Representation Agreement done along with the will.

Estate Freezes

  • Estate freezes are a way to potentially defer the taxes related to the ownership of a qualifying small businesses.   An individual who owns shares in a qualifying small business corporation may be able to claim an $800,000 lifetime capital gains exemption (LCGE) when those shares are sold. By using an estate freeze it may be possible for parents who are close to or have exceeded their LCGE to have their children access some of their LCGE by becoming owners of shares of the business through a family trust. Careful consideration to the timing and structure of estate freezes need to be made and consultation with estate freeze experts is recommended.

Charitable trusts

Starting a Foundation

Charitable Gifts



  • Receiving an inheritance can be a life altering event. Careful planning should be put into how to best use the inheritance regardless of the size to maximize your situation. This may be an opportunity to pay down debt, purchase a new home or recreational or rental property, or invest into your RRSPs, TFSAs or your children’s RESPs.
  • Lots of opportunities may exist for you and a discussion with your qualified financial planner will be useful in developing a plan that will accomplish your goals and maximize your opportunities.

Life Insurance

  • Life insurance is usually taken out to provide an amount of money to improve the beneficiary’s financial situation should the insured die. If no life insurance was taken out it would be possible that the beneficiary might have to go into debt or use the existing wealth already accumulated to continue on with a similar standard of living.
  • Therefore, on the one hand we see having the proper amount of life insurance as a way of protecting one’s wealth when there is not enough wealth already accumulated to sufficiently provide for the rest of the beneficiary’s life.
  • On the other hand, even when sufficient wealth exists life insurance can be useful in paying for estate related expenses and taxes or to enhance the amount left for the beneficiaries which could also be to charities.
  • Life insurance comes in different types (term, whole life, and universal life) which can have different purposes. Obtaining the right type of insurance is important and getting the best price for the insurance can also help in having more available to save. Using a qualified financial planner to assist with selecting the right plan at the right price is a good plan. Planwell offers a free assessment of your insurance needs and since the compensation comes from the insurance companies there is no cost to you for the assessment, application, processing and future servicing of the insurance plans.

Funeral planning options

  • Pre-planning one’s funeral can be advantageous from many perspectives. It should make it much easier for those with the responsibility of arranging your final affairs and it should reduce the cost of those arrangements if planned in advance.
  • Funeral homes offer pre-paid funeral packages which may or may not be a wise decision. The key advantage of these packages is simply knowing who to call when the time comes and knowing that certain requests of the deceased have already been arranged ahead of time. Financially however pre-paid plans may not offer the best return as an investment, but the peace of mind may be worth it.
  • Most important is to spend some time considering how you would like things to be done upon your death. A very good guide to use for this purpose is the BC Memorial Society’s “End of Life Checkup” booklet (see below)
  • Prepaying for a burial site or cremation site may also be advantageous as the cost of these do seem to be increasing significantly and is a great thing to get out of the way and pre-fund prior to when it is needed.
  • Part of a good financial plan will be to ensure you have considered End of Life issues and have a plan in place that you are comfortable with. See a qualified financial planner for more information.


Planning Well
LeadS To
Living Well.

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