Putting One’s Personal Affairs in Order: an Estate Planning Overview – Vol. 1: Wills

In a series of blogs, I will provide (with thanks for the wonderful assistance of our articling student, Stephanie Dewey) an overview of some key issues in estate planning.  Estate planning is the process of planning in advance how your affairs should be taken care of and how your assets should be distributed in the event that you become incapable or die. The purpose of this series of blogs is to provide a general overview of the matters which you should consider when developing your estate plan. This series will provide general information regarding how your affairs will be managed and how your assets will be distributed should you become incapable or die without an estate plan. Vol 1 – Wills In the preparation of a Will, the first major question is to decide who will be your estate trustee (also known as executor). You may choose just one estate trustee, or you may choose to have two or more acting together. Further, you can (and should) choose an alternate estate trustee in case one of the appointed estate trustees is unwilling or unable to act or continue to act. An estate trustee can be a beneficiary under the Will. There is no legal requirement that an estate trustee have special skills or training. However, the administration of an estate is important and complex and the estate trustee may be personally liable for mismanagement or breach of his or her duties. As such, you should appoint someone with the necessary skills and experience, or strongly encourage your estate trustee to seek guidance from professionals. The duties of the estate trustee include making funeral arrangements, locating and taking control of assets, paying taxes and other debts, and distributing remaining assets according to the instructions of the Will. As a general rule, the estate trustee is entitled to a fee of 2.5% of the value of the estate on the accumulation of the assets and another 2.5% on the payment of expenses and due distribution of the assets, as well as an annual care and management fee of 2/5ths of 1% of the value of the estate where there are ongoing trusts. The estate trustee’s fee is subject to the review and approval of the beneficiaries. In the event of a dispute, the court will finally determine the amount of compensation that is fair and reasonable. The estate trustee’s fee is in addition to any fees which might be charged by professional advisors for professional services and advice.