(Prepared with the assistance of Siyamson Pathmanathan, Summer Law Student)
Things are tougher now for the under-35 crew. I hear about it in the news. I see it in my own family and in the families of my friends.
Fewer young adults are married with children, as compared to previous generations. The economic reality is that more of you are in precarious jobs. As a result, most of you think that estate planning is only for your parents’ generation. Estate planning is put off until “later”. This trend is growing. Between 2005 and 2016, there was a 10% decline in the number of individuals under 30 in the USA who have a Will.
Estate planning is not something that should be neglected or put off. It’s a small investment but its absence can cause extra hardships later on for your estate and your loved ones. Because we all know that ‘stuff’ (ahem) happens!
My earlier blog posts have touched on some of the reasons why a Will and Powers of Attorney are important. Today, I want to emphasize issues that I think are especially relevant to the millennial generation.
(And FYI, a digital will is still invalid in Ontario. We don’t use quill pens any more, but paper still rules. )
“But I don’t have assets to make it worth the hassle and cost!”
Even if you are not a millionaire with multiple houses, you are still better off than you think. You might have a car, an expensive mountain bike or camping gear, RRSPs, a TFSA, accident or life insurance through your work or automobile insurance. If you contribute to a pension plan, that would provide a tidy lump sum refunded to your estate (or a designated beneficiary). Do you have vintage items or collectibles? A large balance in a points program? A small side business?
Do you care who would receive any of these items?
If you die or are injured in an accident, your family may want to sue the person who was at fault in causing your injuries or death. You would make that job immeasurably easier for them with a Will or power of attorney in place allowing them to act without having to pay for additional court proceedings.
Unless you choose your beneficiaries (and also designate who can act for your estate), the law dictates who would be entitled to your assets on your death. In Ontario, the priority is your married spouse and children; if none, then your parents (equally); if none, then your siblings (or their children); if none, then your grandparents; if none, then your uncles and aunts; if none, then cousins and more distant relatives.
Do you have a common-law spouse?
Younger adults today are less likely to be married than in past generations. Contrary to popular assumptions, under Ontario estates law, a ‘common law’ spouse would not be able to benefit from your estate unless you provide for them in your Will.
Do you have pets?
Apparently, millennials adopt more pets than other population groups. Do you want to prevent your beloved pet from being delivered to the nearest Humane Society? You can instruct the executor (‘estate trustee’) or your attorney appointed in your Will to ensure that a suitable person adopts your pet. You could also provide a small bequest to this new owner to assist with the costs of their future care.
Do you have social media accounts, points programs or crypto currencies?
Any of those would be extremely difficult to deal with after your death unless you have a Will giving explicit authority to your Trustee (or a power of attorney to act for you when you’re incapable) to access your accounts, deactivate them, transfer or redeem points, and so on.
Are your parents divorced? Do they get along? Are you estranged from one of them?
Unless you specify ahead of time, if you don’t have a legal spouse or a child then both parents would be your legal heirs. Both parents would need to work together to administer your estate, decide whether to bury or cremate you, etc.
It could be even more complex and expensive if you are severely injured and unable to make your own decisions (see below). By law, unless your intentions are expressly stated in a power of attorney, your parents may have equal legal rights to your medical decision making, regardless of whether you are closer to one over the other. Do they share your values in such matters?
Families have changed. Do any of these scenarios cause you chills? Then plan ahead to make sure it does not happen.
Things get even more complicated if you are alive but mentally incapable of taking care of your own affairs, and have not planned ahead.
Estate planning also includes thinking about your values and your wishes if something were to happen to you so that you become incapable of making your own decisions. As scary as it is to consider such a circumstance, it would significantly ease the burdens on your loved ones ̶ who are not getting any younger themselves ̶ if you have Powers of Attorney for Property and for Personal Care in place. Especially for financial and property issues, it can be a very lengthy, invasive and expensive process for your family to obtain the authority to manage your affairs for you. They don’t automatically step into your shoes. If you don’t have a Power of Attorney for Property in place, the Public Guardian and Trustee may become your statutory guardian for some time and possibly the duration of your incapacity.
The death or health crisis of a loved one is never easy. The last thing anyone wants during such a time is the added cost or complexities of a family member dying without a Will or who has become mentally incapable (e.g. due to an illness or accident) without a valid Power of Attorney in place.
Estate planning ensures that your wishes are expressed clearly and made legally binding, to avoid any undue familial conflicts and additional costs in managing your affairs. If your matters are still simple, the cost will be reasonable. It could be your best investment.