Column: Willpower won’t write your will

After John died, his family discovered that he had not written a will. He was 68 years old and had been married for over 30 years to Mary, with whom he had two children. Their wills provided for all assets to be divided equally among the surviving spouse and both children.

Their wills were written 25 years ago, but unfortunately dropped in the bottom left-hand drawer of John’s desk and never signed by both parties. At that time, they had a little over $100,000 in assets.

The only will that had ever existed would have divided $100,000 equally among three people. Today this estate would be worth over three million dollars! Because of the intestacy laws of our province, Mary got the spousal home and furnishings, which is worth $1,500,000. She also received the first $300,000 of the remainder and then 50 per cent of the net value of the balance of the estate after taxes and administration fees. When the ink had dried, the two children received $250,000 each.

Mary is willing to settle for what the intestacy laws determine in the absence of a legal will. The children believe that the net estate should be divided equally among them and their mother as was stipulated in the unsigned will. As you can imagine, this issue is causing a lot of family discord at a time when they should all be supporting each other. Because the unsigned will was drafted so long ago, it is unlikely that the children will have any success in challenging the formula prescribed by the BC Wills and Estates Succession Act.

As you can see, procrastination can have serious consequences. For John’s spouse and surviving children, the road to estate hell was truly paved with his good intentions!

Willpower was not enough. What they needed was a better process for deciding how their wills would be structured. It may sound complicated but there is a simple process:

1. Write down what you would like life to be like for those you leave behind, for the causes that you believe in and what proportion of your wealth needs to go to them all.

2. Create a checklist of everything that needs to be done to make that happen.

3. With your family and your advisors, work through the checklist step by step, realizing that it will not be perfect the first time around, but will improve as you review and adjust over time.

I wrote an interesting article in the Richmond News last August on demystifying the estate plan that you might find useful. A webinar is being hosted on January 27 at 3:00 p.m. with Thomas Deans, PhD, renown New York Times Best-Selling author of “Willing Wisdom" to expand about information on wills. The webinar is free, and registration can be done by clicking here.

Unless steps are taken NOW (years earlier) to create your will, all your willpower will be for naught.

Richard Vetter is a Certified Financial Planner and owner of WealthSmart Inc.