Do you want to create your estate plan in the new year, but don’t know where to begin? Here's an estate planning checklist for 2023 to get you started.
Estate planning can easily feel overwhelming but it doesn’t have to be. While you will need to make plenty of important decisions, they don’t need to all be made in one day.
To help keep you on track, we’ve broken down the steps in an estate plan into your very own estate planning checklist for 2023. You can even download a condensed estate planning checklist at the end!
☐ Create a will
A will is probably one of the first documents that comes to mind when you think of estate planning. There’s a few key things to include in your will:
☐ Your assets
Making a list of your physical assets and recording where they’re located is critical. The location of some assets (like your home) will be fairly obvious but if you have assets that are located in storage or even outside the country, you need to record where they are. Without recording that valuable information, your executors will struggle to find them or even know they exist altogether.
☐ Your beneficiaries
Deciding who will inherit your assets is one of the key decisions you’ll need to make in your will. This could be friends, family or a charitable organization that’s meaningful to you.
If you already have a will, it’s important to review your beneficiaries to ensure they’re up to date and reflect any changes in your life, like new children or relationships.
If you have minor children, selecting guardians is another important part of a will. Having open and honest conversations with the person or people you have in mind is essential.
If you have already selected guardians, checking in with them every few years to see if they’re still in a position to care for your children is also important.
☐ Your executors
Naming the right executors is crucial when setting up your will. These are the people who will help carry out your wishes after you’ve passed away. As with guardians, it’s important to speak with people before you appoint them as executors in your will.
Naming more than one executor ensures that even if one executor is ever unavailable, there’s someone else who can legally manage your estate. While there’s technically no limit to the number of executors you can appoint, naming too many could become problematic— think too many cooks in the kitchen.
While it’s a great honour to serve as an executor, not everyone has the skills or availability to serve. Here’s 5 questions every potential executor should ask themselves before saying yes.
If you aren't sure who to appoint, have a complex estate or there's challenging family dynamics, a professional executor can be a great option.
☐ Create a power of attorney document
A power of attorney is a document which gives someone the authority to manage your money or property on your behalf while you are alive. Whoever you’ve appointed becomes your “attorney”, even if they’re not a lawyer.
Having an attorney can be helpful if you’re ever unable to pay bills or take care of other important matters, due to illness or hospitalization, mobility issues, or even just being away for work or travel.
An enduring power of attorney is important if you’ve been diagnosed with a progressive illness like Alzheimer’s. This allows for your attorney to continue making decisions on your behalf once you have lost the legal capacity to do so.
If you already have a power of attorney in place, reviewing it when you’re reviewing your other legal documents is a good habit.
☐ Update insurance
Life is constantly changing and so should your insurance coverage. As with other parts of an estate plan, your insurance should be updated to reflect any changes in your life.
Having outdated beneficiaries can mean people who are no longer in your life could inherit your life insurance policy, while the people who are wouldn’t receive anything.
☐ Document funeral wishes
Recording your funeral wishes can be a wonderful gift to your loved ones.
A few things to consider about your funeral wishes:
Do you want to prepay for the funeral?
Where do you want your funeral to take place?
Do you want a traditional funeral or more of a joyful celebration of your life?
Do you want to be buried or cremated?
Do you want to have your body donated to medical science? If so, have you registered with an educational institution’s body donation program and do you have an alternative in place in the event your body is not accepted?
Is there anything you want or don’t want included in your obituary?
Are there specific songs you want played during the service?
These can be overwhelming questions to think about but remember, you don’t have to plan your entire funeral. Maybe your only real preference is that you want to be cremated, but the rest is up to your family members and friends to celebrate your life however they wish. Whatever you end up planning, it’s important to record and communicate where those wishes can be found.
While you may have talked to your close friends and loved ones about your funeral wishes, it can be difficult to recall conversations during stressful times. And few times in life are as stressful as losing a loved one.
☐ Start financial planning
While Canada doesn’t have inheritance or estate tax, working with a financial advisor or planner can help to reduce probate fees associated with your estate. When your will goes through probate it becomes available in public records, so if you’re concerned about privacy, you may want to consider doing what you can to avoid it.
It’s important to note that probate fees can vary across Canada so if you’re in a province like Manitoba that doesn’t have any probate fees and you’re not worried about privacy, it may not be worth the time and costs involved.
As with other aspects of an estate plan, retirement planning should be started sooner than later. The earlier you start financial planning, the more you’ll be able to save for the future.
☐ Document digital assets
With physical assets such as real estate, investments accounts, and bank accounts, there is a centralized body you can contact to find out if someone had assets there. This is not the case with digital assets. That’s why it’s so important to record them so they can be found and accessed. However, it’s best left out of your will due to potential privacy issues if it were to go through probate and become public record.
It’s also important to ensure executors have access to digital accounts. Digital assets are a significant security risk when left open and unmonitored. However, there are steps that can be taken to prevent identity theft and fraud after someone has passed away.
What is the most fundamental element of an estate plan?
The most fundamental element of every estate plan is ensuring that it can be found promptly. It doesn’t matter how often you update your estate plan or how much careful consideration you put into it if your executors can’t find any of the documents. Finding your estate plan shouldn’t be the world’s most stressful treasure hunt.
A safety deposit box might seem like the most secure place for the important documents in your estate plan — but by the time your safety deposit box is opened, the window for organ, tissue or full body donation will have closed. It can also be difficult to prove to the institution storing the safety deposit box that someone is an executor when the documents to prove this are inside the safety deposit box.
Uploading your estate plan into your EstateBox and assigning your executors as delegates is an easy way to ensure your documents can be quickly accessed whenever they’re needed. Create your account today and enjoy a 60-day free trial (no credit card or code required) to help you get started on your life and legacy plan.
While we’re passionate about all things estate planning, we’re not professionals. We recommend speaking with your lawyer or financial advisor when putting together an estate plan.