Michael Ford (post until Oct. 31/19)
Estates & Wills & Trusts

Without a will, rules of intestacy apply

While statistics show that more than half of Canadians don't have a will, Toronto wills and estates lawyer Lisa Laredo says it’s important to understand what happens when you die without one.

“People may think they’re too young or not wealthy enough to have a will, but without one there may be a contest amongst relatives of equal rank as to who will administer your estate,” she tells AdvocateDaily.com. “With a will, you can distribute your assets, give your executor a road map as to your last wishes including funeral arrangements, and donate to your favourite causes."

An Angus Reid poll reveals that a significant number of respondents said the reason they don’t have a will is that they feel they are “too young.” Older Canadians (those over the age of 55) were nearly four times more likely than those between the ages of 18 to 34 to have a will.

Laredo, principal of Laredo Law, says while it may be uncomfortable to plan for death, doing so ensures that you have a say in how your assets are divided and who will wind up your affairs.

“If there’s no will, the Succession Law Reform Act (SLRA) sets up a scheme of distribution that may not be desirable,” she says.

Laredo says under the SLRA, an intestate estate is distributed in the following way:

  1. If you have a spouse and no children: “Your entire estate goes to your legal spouse. Even if you’re separated from that spouse, your estate still goes to that person unless you’re legally divorced,” she says.
  2. If you have a spouse and children: If your estate is worth less than $200,000, then your spouse gets it all and your children get nothing. “If your estate is worth more than $200,000, your children fare a little better, but not much,” Laredo says. “Your spouse still gets the first $200,000 and then the remainder is divided amongst your children, with your spouse still receiving a third of that remainder.”
  3. If you have children but no spouse: “In this scenario, the entire estate is split evenly amongst your children, regardless of whether one of your children needs more,” she says.
  4. If you have no spouse and no children: In this case, your estate goes to your parents, siblings, nieces and nephews and any other next of kin that can be found. “In other words, you could end up giving an inheritance to a long-lost relative,” Laredo notes.
  5. If you have no spouse, no children and no known next of kin: “If no one can be found then your entire estate goes to the government. Every last cent,” she says.

The Angus Reid poll also revealed that almost a quarter of respondents don’t have a will because they think they don’t have enough assets to make it worthwhile.

Laredo says even if an estate contains no assets of significant size and therefore may not require probate, creating a will makes administering the estate easier because it would contain a plan of distribution.

“As well, a testator can distribute particular assets, such as sentimental items, to specific people. In the absence of a will, there is no power to make specific bequests,” she adds.

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