Estate planning is one of the most important steps you can take to protect your family’s future. Whether you’re starting to consider your own estate plan or helping aging parents manage theirs, understanding the process can help you make the best possible choices and feel as comfortable as possible moving forward.
If you’re in this position and not sure where to start, you’re in the right place. Our estate planning lawyers in Mississauga, Barrie, Newmarket and Richmond Hill have guided Ontario families through the processes countless times, and we often hear the same questions. This guide will break down those common questions and prepare you to start estate planning, explaining the concepts you need to know and providing practical insights you can use today.
What Is Estate Planning and Why It Matters
Estate planning is more than just simply writing a will. It’s a full process that involves organizing your affairs, protecting your assets and ensuring your wishes are carried out – both during your lifetime and after you’re gone.
A proper estate plan includes several main documents: a will, powers of attorney for property and personal care, and potentially trusts or other arrangements depending on your circumstances. These documents create a safety net to protect you, your family and your assets. As we outline in our comprehensive guide on 7 Steps for Estate Planning Strategies That Everyone Should Consider, taking inventory of your possessions and consulting with experienced legal counsel are fundamental first steps here.
Why Estate Planning Matters
Without proper estate planning, you’re essentially leaving critical decisions about your life and assets to the government. In Ontario, if you die without a will (called dying “intestate”), the provincial laws determine how your assets are distributed. Understandably, this might not align with your wishes and can invite unnecessary stress and expense for your loved ones.
Did you know that in Ontario:
- Only roughly 50% of Canadians have wills
- Even fewer have created proper estate plans
How a Proper Estate Plan Protects You
A thorough and thoughtful estate plan gives you and your family multiple layers of protection:
- Asset Protection: Makes sure your assets go to your chosen beneficiaries, rather than being distributed according to government formulas
- Tax Efficiency: Minimizes taxes owed by your estate
- Family Harmony: Clear instructions to reduce the possibility of disagreements between family members
- Speed and Cost Savings: Proper planning streamlines the estate administration process
- Peace of Mind: Knowing your affairs are in order reasonably gives many people a sense of security
Estate Planning Services and Elements
Estate planning pulls together several services and documents. Understanding each component helps you build a comprehensive plan tailored to your needs.
Wills
Your will is the cornerstone document to direct how your assets should be distributed after death. It also names your executor (the person responsible for carrying out your wishes) and guardians for minor children, if applicable.
Not having a will creates significant complications for your loved ones. As outlined in our Guide to Transferring Property After Death in Ontario, if a will isn’t available, the assets of the deceased will be distributed in accordance with the rules set out in the Ontario Succession Law Reform Act.
Powers of Attorney
Powers of attorney are important documents to authorize someone to act on your behalf if you become incapable, or otherwise unable to act for yourself. In Ontario, there are two types: power of attorney for property (financial matters) and power of attorney for personal care (healthcare and living decisions). For more details and deeper understanding of these two types, read our previous article dedicated to Power of Attorney in Ontario: Property and Personal Care.
Power of attorney documents can become sources of conflict if not properly executed. As mentioned in our analysis of the Most Common Estate Litigation Issues, if the power of attorney was put into place under duress or due to an incapacity, or if the person being granted power of attorney has not carried out the intentions of the testator accurately, serious challenges can arise.
Estate Administration, Litigation and Other Components
Here are a few more terms and components you should be aware of within the estate planning process:
Estate Administration settles your estate after death. This would include gathering assets, paying debts and taxes, and distributing inheritances. The executor is in place to take inventory of all assets and repay estate debts before giving out any money to the beneficiaries.
Estate Litigation happens if and when necessary, resolving disputes through negotiation, mediation or court proceedings. Family dynamics usually play a significant role here, as grievances, grudges and differences of opinions can all come to the surface after the death of a parent or loved one.
Trusts are legal arrangements where assets are held and managed by designated trustees for the beneficiaries. They provide tax advantages, asset protection and control over how and when the beneficiaries receive their determined inheritance.
Probate is the court process that validates a will and authorizes the named executor to administer the estate. Note: if the deceased owns property as a Joint Tenant, probate may not be needed. This can greatly streamline the property transfer process for survivors.
Understanding Your Will
Your will is arguably the most important document you’ll ever create. Mentioned in our previous article detailing Making a Will in Ontario, as of 2024, 54% of the population in Ontario lacks a valid will. Without this legal document, intestacy laws determine who inherits your estate – meaning the province automatically decides who gets what, which may not reflect your desires and can understandably lead to conflicts.
Creating Your Will
In Ontario, you must be at least 18 years old and of sound mind to make a valid will. The will must be in writing, signed by you in the presence of two witnesses who are not beneficiaries, and those witnesses must also sign the document.
“My simple advice is, don’t overthink it,” says Mark A. Epstein. “Estate planning doesn’t need to be complicated. Rather than putting it off, put something on paper to ensure that your wishes are followed.”
Outlined in our comprehensive guide on how to make a will in Ontario, you are never too early to make your will in Ontario – so long as you are over the age of 18. A well-drafted will should include these key components:
- Executor Selection: Choose someone trustworthy, organized and preferably living in Ontario to be responsible for the administration of your estate
- Beneficiary Designations: Clearly identify who should receive your assets and what they should receive
- Guardian Appointments: If you have minor children, name guardians for their care and well-being
- Asset Distribution: Specify how your assets should be divided, including any special instructions or conditions
Types of Wills
- Simple Wills: Appropriate for straightforward situations with basic asset distribution and standard family structures
- Complex Wills: Necessary when dealing with complicated finances, business ownership, blended families or special needs beneficiaries
- Joint Wills: One document created by two people (usually spouses). While possible, these create complications and are generally not recommended
- Holographic Wills: Handwritten wills that don’t require witnesses but often create problems
“We rarely see holographic wills and when we do, the biggest issue is enforceability,” notes Mark A. Epstein. “In many cases the document isn’t enforceable. We just had one case where a daughter is named as trustee, but the will doesn’t say what she is supposed to do with the estate. It just reads that she will be the trustee and have full and absolute control.”
Power of Attorney
Power of attorney is an essential component that many people overlook until it’s too late. These documents make sure someone you trust can manage your affairs if you become unable to do so yourself.
Many people assume power of attorney is only necessary to have in place for older individuals – this isn’t the case. These documents might not be on your radar if you’re relatively young and healthy. However, a power of attorney document is an essential component of your estate plan, for adults of any age. For a deeper look at the ins and outs of this piece, take a read through our previous article, Power of Attorney in Ontario: Property and Personal Care.
Types of Powers of Attorney
Power of Attorney for Property: allows your appointed attorney to manage your financial affairs, including banking, investments, real estate transactions and business matters. Despite the name, it covers your bank accounts, bills, taxes and other financial responsibilities, including digital assets like online banking, investment apps, cryptocurrency and social media accounts.
Power of Attorney for Personal Care: allows someone to make healthcare decisions, housing arrangements and other personal care matters on your behalf.
Continuing vs. Non-Continuing: Continuing powers of attorney remain valid even if you become mentally incapacitated, while non-continuing POAs end if you lose capacity. For the best protection, continuing POAs are typically recommended.
Understanding POA Powers and Limitations
Unless you restrict your Continuing POA’s powers, they can do almost anything concerning your finances, including sign documents, start or defend a lawsuit, sell property, make investments and purchase things for you. However, they can’t make a will or give a new Continuing POA for property on your behalf.
Digital Assets and Modern Estate Planning
The digital era has created new categories of assets needing special consideration in estate planning. Unsurprisingly, the average person today holds multiple online accounts and stores a variety of digital documents, all with different levels of importance. For a closer look into how to plan for these digital pieces, visit our earlier article, A Modern Estate Plan: Managing Your Digital Assets.
What Makes a “Digital Asset”
Digital assets include a wide range of online accounts and digital property, including:
- Financial Accounts: Online banking, investment platforms, PayPal, cryptocurrency wallets
- Social Media: Facebook, Instagram, Twitter, LinkedIn accounts and conversation histories
- Digital Collections: Purchased music, movies, e-books, digital art
- Cloud Storage: Google Drive, Dropbox, iCloud accounts containing photos, documents and personal files
- Business Assets: Websites, domain names, online businesses, digital intellectual property
- Additional Assets: Email accounts, subscription services, loyalty program points, smart home data
Planning for Digital Assets
To effectively plan for your digital assets, we recommend creating an inventory of all your digital accounts, storing access information securely and providing clear instructions for how these assets should be handled.
Key planning steps:
- Create a comprehensive digital inventory documenting all online accounts
- Include digital assets in your will – but store passwords separately, as wills become public record
- Use platform-specific legacy tools like Facebook’s Legacy Contact, Google’s Inactive Account Manager and Apple’s Legacy Contact to help maintain control
- Consider special handling for cryptocurrency, as discussed in our article on Cryptocurrency in Estate Planning
Not all digital assets have financial value. Consider the significant sentimental value of family photos stored in the cloud, personal emails and social media accounts. Families can run into difficulties accessing digital assets like cloud-stored photos after a loved one’s passing, and even with proof of death and legal authority, companies like Apple or Google may not allow access without express consent given previously through their platform-specific legacy tools.
Estate Administration
Estate administration involves managing and distributing an estate after someone passes away. Understanding this process helps with both planning your own estate and serving as an executor for someone else.
Executor Responsibilities
“The executor is usually responsible for gathering all the paperwork that we need to proceed with the estate,” explains Mark A. Epstein. “They liaison with the accountants and financial institutions and ensure that we have all the information that we need to proceed with the estate administration. Having said that, in some cases the executor prefers to not act as a liaison and asks our office to facilitate all communication with the separate institutions.”
Key executor duties include:
- Obtaining death certificates, locating the will, notifying beneficiaries and securing assets
- Identifying all estate assets, obtaining appraisals where necessary and preparing a complete inventory
- Identifying and paying legitimate estate debts, including final tax returns
- Understanding which assets pass through the will versus those with designated beneficiaries (like RRSPs or life insurance)
“The estate is responsible for the debts and no one else (unless they signed for it),” notes Mark A. Epstein. “In some cases, the estate’s value is less than the debts and in those cases the executor has to determine how the estate will be administered to ensure there is no liability on their part. In other cases, the estate goes bankrupt.”
Guardian Appointments and Estate Disputes
For parents with minor children, naming guardians is one of the most important pieces in estate planning. “Parents of young children come in and are not necessarily on the same page with who the guardian should be,” observes Mark A. Epstein. “It is also important that the chosen guardian is aware that they have been chosen and are okay with being placed in that role.”
Unfortunately, not all estates proceed smoothly. As we detail in our guide on Navigating Inheritance Disputes Between Siblings, “inheritance disputes between siblings can create tension in a family resulting in unwanted stress in an already difficult time.” Family dynamics often play a significant role, as “petty grievances, grudges and differences of opinions, or personalities, can all rise to the surface after the death of a parent or loved one.”
Will contests are another frequent source of disputes, particularly when a will does not reflect the reality of the family situation or when there are questions about the testator’s capacity. Our guide on How to Fight a Will Challenge outlines that “a will cannot be challenged because individuals are unhappy with the terms laid out in the will.” Valid grounds for contesting the validity of a will include undue influence, lack of capacity, fraud or improper execution.
Probate
Probate is the court process that validates a will and grants legal authority to the executor to administer the estate. As detailed in our Guide to Transferring Property After Death in Ontario, “when a will is present, the executor or trustee mentioned in it will be responsible for starting the probate process, which is the procedure required to prove and register a deceased person’s will with the court.”
Probate Costs and Strategies
Probate taxes in Ontario:
- $5 per $1,000 for the first $50,000
- $15 per $1,000 for amounts over $50,000
“There are many things that can be done to minimize Probate Taxes such as trusts to own property of elderly family members, holding property in joint names and ensuring there are beneficiaries of registered accounts such as RRSPs and life insurance policies,” advises Mark A. Epstein.
Additional costs include legal fees, land transfer tax, valuation fees, title transfer fees and various disbursements for document preparation.
Special Situations
You might find yourself with circumstances requiring additional estate planning considerations past standard wills and powers of attorney.
Common Law Partners
For those in common law relationships, estate planning becomes even more critical. As explained in our comprehensive guide on Estate Planning for Common Law Partners in Canada, “unlike married couples, common-law partners don’t have automatic inheritance rights.” Without proper planning, “assets might go to the deceased’s blood relatives (parents, siblings) even if they weren’t close to the couple.”
“A will is non-negotiable for common-law couples” because it allows you to “dictate how your assets will be distributed, ensuring your partner and, if desired, other beneficiaries (e.g., children from previous relationships) are provided for as you intend.”
Asset ownership considerations for common law couples:
- Joint Tenancy with Right of Survivorship: If one partner dies, the other automatically inherits the entire asset, offering simplicity and ease of ownership transfer
- Tenancy in Common: Each partner owns a distinct asset share, which allows for more flexibility. If one partner dies, their share doesn’t automatically pass to the other – it follows the instructions in their will or provincial laws if there’s no will
Other Special Considerations
Business Owners need specialized estate planning to address business continuity, valuation and ownership transfer through buy-sell agreements and succession planning.
Pet Planning: “A trust can be established for the care of a pet, or even a cash payment,” explains Mark A. Epstein.
Charitable Giving can provide meaningful support to causes you care about while potentially offering tax benefits to your estate.
Common Mistakes and Red Flags
As you can imagine, common mistakes are easy to fall into when estate planning. Understanding these mistakes before they occur helps you avoid potential problems that could impact your family later.
Critical Mistakes to Avoid
“The number one mistake that people make doing their own wills is, improperly preparing the document or conveying their wishes,” says Mark A. Epstein.
Other frequent mistakes include:
- Failing to update beneficiary designations
- Not coordinating all estate planning documents
- Inadequate planning for digital assets
- Failing to properly secure important documents
As outlined in our guide on What happens when an original Will is lost or destroyed?, “Without a will that’s secured and easily available, your family and friends will be left to navigate dividing your assets without guidance.” Naturally, this can cause a series of issues.
Another potential challenge to account for ahead of time? “Inconsistencies or inequitable bequests. If a client is making an unequal division we always suggest that the inequality be explained in the will so there is no confusion why it is being set up that way,” notes Mark A. Epstein. “Another big red flag is when an elderly family member has a new will prepared at the end of life; this invariably leads to issues if there was a departure from their previous wills.”
When Should You Update Your Estate Plan
Estate planning isn’t a one-time activity, and should be treated as fluidly as life itself. As outlined in our comprehensive guide on 7 Major Life Events That Signal It’s Time To Update Your Will, “life changes, situations shift, families grow and your assets accumulate. However, many Ontarians prepare their wills, file them away, and rarely review them – if ever.”
Key Life Changes Requiring Updates
Relationship Changes: Marriage and divorce are significant triggers for updates as one of the biggest life changes many of us will experience. It’s a great time to also review and update – or create – your will and estate plan. Remember: In marriage, your new spouse is not automatically added to your will.
“Separation and divorce can create unintended gaps in an estate plan if a will isn’t updated. Although Ontario law revokes many gifts and appointments to a former spouse, it doesn’t rewrite the entire will. Critical assets may still be directed in ways that no longer reflect your intentions, making a timely review essential,” explains Roy S. Hwang, Partner at Epstein & Associates PC.
Other important triggers include:
- Family additions (children or grandchildren)
- Property and asset changes
- Financial changes (inheritance, investment gains/losses, debt changes)
- Executor changes due to relocation, health issues or death
- Legal changes in estate law
- Significant changes to digital assets
Regular Review Schedule
“A will should be treated like a living document — not a one-time task. Even without major life events, we recommend reviewing your will every three to five years to ensure it still aligns with your wishes, your family circumstances and evolving laws that could impact your estate,” advises Roy S. Hwang.
Your will likely needs attention if:
- It’s more than five years old
- You’ve experienced major life changes
- It was created in another province or country
- You can’t remember what it includes
- It doesn’t include your digital assets
- It names executors or guardians who are no longer appropriate
Working with Estate Lawyers
While some basic estate planning can be done independently, many situations benefit from professional legal guidance.
When to Seek Legal Assistance
“Typically, extenuating circumstances such as more complex finances, disabled children and privately owned businesses will make us suggest a more robust estate plan,” explains Mark A. Epstein. Additionally, if your family has a history of disagreements or you’re concerned about potential challenges to your will, proactive legal guidance can help prevent costly disputes.
Estate litigation issues are common, ranging from power of attorney challenges to contested wills and family breakdowns that can complicate estate administration. To minimize future conflicts, try and understand these potential pitfalls early and structure your estate plan to account for concerns.
How Lawyers Can Help
Estate lawyers are here to provide valuable assistance in navigating complex family dynamics, tax implications and ensuring all documents work together effectively. They can also help resolve disputes and provide ongoing advice as circumstances change.
When disputes do arise, experienced estate lawyers can guide you through the process of defending against will challenges. This includes gathering evidence to support the will’s validity, exploring negotiation and mediation options and, if necessary, presenting a strong case in court to uphold the testator’s wishes.
Choosing the Right Lawyer
When selecting an estate lawyer, consider their experience with situations similar to yours, their communication style, fee structure and their approach to client service. The right lawyer should make complex legal concepts understandable and provide practical guidance tailored to your specific needs. Look for lawyers who have experience not only in estate planning but also in estate litigation – this dual expertise can be invaluable if you’re faced with both preventing and resolving disputes.
Next Steps
Estate planning is one of the most important pieces to have in place for your family. It provides clarity during difficult times, protects your assets and ensures your wishes are carried out according to your intentions.
At Epstein & Associates PC, our estate planning lawyers in Mississauga, Barrie, Newmarket and Richmond Hill are committed to helping Ontario families create comprehensive, effective estate plans, without the fuss. Contact us today for a free consultation to discuss your estate planning needs.
