There are numerous types of investments that can bolster one's retirement portfolio, but for many people, their largest investment is in their home. For some homeowners, it may make sense to cash in on the principle residence and add the proceeds to the retirement nest egg.
At Hagel Lawfirm, we have seen a wide variety of scenarios in which surviving family members have been confused and hurt by their loved ones' estate planning.
It is estimated that $30 trillion in assets will be transferred from Baby Boomers to their heirs in the coming decades. For Canadians specifically, the inheritance boom is expected to involve the transfer of $1 trillion in the next 20 years.
Canadian families are perhaps more diverse now than ever before. An aging boomer population, second or third marriages, non-traditional households, loved ones with special needs -- these are all important realities to consider in estate planning.
According to Statistics Canada, the average net worth of Canadian families has risen significantly in the last two decades. Between 1999 and 2012, average wealth increased by 73 per cent -- from $319,800 to $554,100. Much of this wealth is held by baby boomers, and it is estimated that, in the next four decades in North America, more than $30 trillion in assets will be passed from boomers to their heirs.
The Financial Planning Standards Council is the not-for-profit organization that establishes professional standards for financial planners in Canada. An appropriately qualified professional can earn a Certified Financial Planner certificate, but there is currently no legal requirement that a person become a CFP before charging Canadians for financial planning services.
Avoiding taxes or minimizing their impact on your estate is an essential part of comprehensive estate planning. Compared with other provinces, Ontario has a particularly high estate administration tax. However, there are strategies that a lawyer can help you implement in order to minimize your estate's tax burden.
The tax free savings account is a cost-effective investment tool not only because it shields your savings from taxes, but also because a TFSA is not necessarily subject to probate and can be used to pass an inheritance confidentially to a beneficiary.
If you have significant assets that you want to see grow and mature, then a financial advisor can be a great help, particularly with the technical aspects of your investments. It is also important to stay informed and be aware of what your financial advisors are doing.
There are many different kinds of Canadian trusts, and they can be beneficial in a variety of ways. Because a trustee has a fiduciary duty to manage the trust properly, it is important for any trustee to understand specifically what kind of trust it is and what it can do. Also, trustees must ask themselves, "What are the goals and needs of the trust creator and the beneficiary?"