My name is Mark Goodfield. Welcome to The Blunt Bean Counter ™, a blog that shares my thoughts on income taxes, finance and the psychology of money. I am a Chartered Professional Accountant and a partner with a National Accounting Firm in Toronto. This blog is meant for everyone, but in particular for high net worth individuals and owners of private corporations. The views and opinions expressed in this blog are written solely in my personal capacity and cannot be attributed to the accounting firm with which I am affiliated. My posts are blunt, opinionated and even have a twist of humor/sarcasm. You've been warned.

Monday, September 19, 2016

Canadians Don't Have the Will

Over the last few years, I have often referenced a 2012 survey by LawPRO reflecting that 56% of Canadians do not have a Will. I have used this startling statistic to urge you to have a Will drafted (or updated) and to suggest you also put in place powers of attorney for property (financial decisions) and personal care (health decisions). The fact that Prince did not leave a will (which I find incomprehensible, given the number of advisors he would have had) has brought further attention to this issue.

Shockingly, in a new Google Consumer Survey conducted by Legalwills.ca, the number of Canadians without Wills has increased to 62%. The survey also notes that 12% of Canadians have an outdated Will (most never updated their Wills once they married and/or had children), which means that 74% of Canadians do not have an up-to-date Last Will and Testament.

In general, I consider this behaviour selfish and I cannot understand how anyone that is part of a functional family unit would ever want to leave their family the chaotic mess that follows when there is no Will in place.

Here are some facts from the Legalwills.ca survey, which can be found here.

Some Startling Numbers


The survey showed a correlation between age group and the probability of having a Will:

Age 18-24: 87% do not have a Will, 5% have an out-of-date Will, and 8% have an up-to-date Will.
Age 25-34: 77% do not have a Will, 10.5% have an out-of-date Will, and 12.5% have an up-to-date Will.
Age 35-44: 68% do not have a Will, 8% have an out-of-date Will, and 24% have an up-to-date Will.
Age 45-54: 53% do not have a Will, 13% have an out-of-date Will, and 34% have an up-to-date Will.
Age 55-64: 32% do not have a Will, 19% have an out-of-date Will, and 49% have an up-to-date Will.
Age 65+: 28% do not have a Will, 21% have an out-of-date Will, and 51% have an up-to-date Will.

As the survey notes, even when discounting younger adults, 48.5% of Canadians aged 35 and older responded to not having a Will and 13.5% responded to having a Will that is out-of-date, leaving only 38% with a Will that reflects their current financial and personal situation.

Unexpected Income Correlation


The survey found a surprising inverse relationship between income levels and the probability of having an up-to-date will.

“The group least likely to have up-to-date Wills was in the $100,000+ annual income range; respondents in this group were also three times more likely to have an out-of-date Will than those with lower incomes. The group most likely to have up-to-date Wills was in the lowest annual income range of $0-$24,999. As annual income increased, the proportion of respondents with an up-to-date Will decreased”.

Legalwills.ca suggests “The cause of this is likely because those with higher incomes can more easily afford to use a lawyer to write their Will; making modifications to a Will with a lawyer requires setting a meeting, and costs hundreds of dollars. To the contrary, those with lower incomes are usually inclined to use more affordable alternatives, such as online services, where the testator can make modifications to his or her Will at any time without extra costs”. (It should be noted that Legalwills.ca provides online services to custom-make Wills, Power of Attorney and Living Wills for Canadians and thus, they have a bias to online services).

Observations from the Survey


Legalwills.ca make some interesting observations from the data, a few of these include:

1. The system for creating and updating Wills is broken – their opinion is the current system is not working for most people.

2. People wait for the perfect time to have their Wills prepared – I agree with this comment. The issue here is; our life circumstances are constantly changing. Consequently, our Will is really a living document that requires various updates throughout our life.

3. Legalwills.ca references a quote from Forbes Magazine by the rapper Snoop Dogg, saying essentially: who cares about his Will, he will be dead. This is not an unusual comment. Legalwills.ca says “unfortunately, what Mr. Dogg doesn’t realize is that writing a Will was never about you. It’s about taking care of your loved ones – the people that you care for through your life, I’m not sure that many people would deliberately inflict trauma on their own family at a time when they can least handle it, but not writing a Will is setting your family up for heartache and emotional turmoil. It all too often leads to acrimonious fallouts between family members who seemed to get along just fine until they
had to work together to administer an estate without a Will”.

4. Legalwills.ca suggests that not having a Will is a huge missed opportunity. They suggest you can do wonderful things in a Will, for example:

  • Leave a few thousand dollars to a charity
  • Give your favourite niece some funds to travel the World
  • Set up an event in your memory
  • Create a scholarship fund
  • Organize and pay for some social events for your best friends
  • Leave a cherished item to somebody who will really appreciate it
  • Make sure your digital accounts are all taken care of appropriately
  • Make sure that your pets are taken care of

Whether you have a complex estate and need a lawyer to draft or update your Will, or have a simple estate for which you can use an online service, as Nike says “Just Do It” and get your Will and powers of attorney in place. You will have peace of mind and your family will be appreciative that you made their financial lives simpler at a time of grieving.

This site provides general information on various tax issues and other matters. The information is not intended to constitute professional advice and may not be appropriate for a specific individual or fact situation. It is written by the author solely in their personal capacity and cannot be attributed to the accounting firm with which they are affiliated. It is not intended to constitute professional advice, and neither the author nor the firm with which the author is associated shall accept any liability in respect of any reliance on the information contained herein. Readers should always consult with their professional advisors in respect of their particular situation.

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