Book Review: Smart Tips for Estate Planning

Estate planning is not just for people who are old or have lots of money. Estate planning is for everyone.

~ Jim Yih & Marvin Toy

If you’re anything like me, estate planning ranks somewhere between going to the dentist and cleaning out the garage on the motivation scale. But it deserves to place much higher in light of its importance to the future well-being of your love ones. Like a lot of the other tasks that we consider boring, tedious, or just too hard to begin, estate planning isn’t so daunting once you take that first step and just get started.

If you’re looking for a great place to start, you might want to pick up a copy of Smart Tips for Estate Planning by Marvin Toy and Jim Yih. Mr. Toy is an experienced lawyer with expertise in the areas of tax law and estate planning. You will likely recognize Jim Yih’s name as he frequently leaves insightful comments on Balance Junkie. He also runs the Wealth Web Gurus website and is an established author, speaker, and entrepreneur. Both authors are well-versed in Canadian financial issues and it shows in this book.

Why Is Estate Planning So Important?

No one wants to think about the prospect of losing a loved one, or of dying and leaving loved ones behind. But the truth is that death is a fact of life and it can come at any time. Many of us feel like we’re too young to think about these matters. After all, we’re years away from where the actuarial tables say our number may be up. But anyone with loved ones needs to think about what would happen if they died tomorrow. How would your spouse or children cope? If you care for elderly parents, who would look after them?

If you are relatively young, chances are that your death would deal an even greater blow to those who depend on you. That’s all the more reason to put some plans into place now so that you can enjoy life without worrying that your untimely passing might place an added financial burden on your already grief-stricken loved ones. According to Toy and Yih, a good estate plan can provide the following benefits:

1. Outline an Enduring Power of Attorney and a Health Care Directive to designate someone to look after your health care and financial matters if you become incapacitated.
2. Make sure that your assets are passed on to your family in the way you want them to be.
3. Protect your estate from creditors.
4. Minimize income taxes after your death.
5. Minimize probate fees and taxes.
6. Minimize income taxes for your heirs.
7. Minimize estate settlement problems.
8. Meet legal obligations to your dependents.
9. Avoid government and judicial intervention.

If you’ve never considered estate planning before, you may be surprised at just how much there is to know. But don’t let that keep you from getting started. Marvin Toy and Jim Yih have lots of great tips on what you need to accomplish and what to look out for along the way.

Smart Tips for Everyone

One thing I really liked about this book is that it’s really easy to read. It provides a lot of information, but it’s broken up into easily digestible bites and spiced with some really good illustrative examples and case studies. You don’t realize how many unique scenarios might pop up until you really delve into the topic. It really makes you examine the specifics of your own situation a little more carefully.

Here are just a few of the tips and topics explored in Smart Tips for Estate Planning:

• Have a Will: This is so important to ensuring that your children and your hard-earned savings end up where you want them to be that I included it in my 10 Steps to Fiscal Fitness. If you have children, or if your assets add up to $100 000 or more, a will is a must.
• Choose an Executor: The authors point out that being an executor is a burden and not a privilege. It’s important that you choose the right person to settle your affairs.
• Name Beneficiaries: If you have RRSPs, RRIFs, TFSAs, or jointly held banking or investment accounts, make sure that you’ve designated a beneficiary and that you keep that information up to date, especially in case of marital breakdown, birth, death, or other material life changes.
• Trusts: There’s a lot of information here on the different types of trusts you can set up and the various situations in which you might want to use them.
• Choosing Professionals: The authors provide some guidance on the types of professionals you may need to help you with your estate planning (lawyers, accountants, financial planners, etc.) as well as some ideas on what to look for with each.
• Leaving Money to Charity: There are lots of good ideas on how best to donate all or a part of your estate to the charity of your choice.
• Dealing with Specific Assets: Again, you may not realize how much there is to consider until you read this section of the book. There are all kinds of assets, from heirlooms to homes, farms, or life insurance that must be taken into account in your estate plan.
• Probate: I found this chapter very interesting as I have never really felt like I had a good grasp on what probate is and how it works. This helped a lot.
• Organ Donation, Funeral Arrangements and other possibly upsetting, but necessary decisions: These aren’t pleasant topics, but we need to address them in the present rather than at a time when we aren’t able to do so, or when our relatives are too upset to make the best choices.
• What’s Your Legacy? In the end our lives comprise a unique story that will be of interest to our heirs for generations to come. Why not put together a narrative using photos, movies, and memoirs as your story unfolds so that your descendants can enjoy it for years to come?

Jim Yih and Marvin Toy point out that, like most aspects of financial planning, estate planning is not something you do once and forget about it. It’s an ongoing process that needs to be revisited and revised whenever a significant life event occurs. So it’s likely that you will be thinking about estate planning issues throughout your life, but not continuously. As such, it’s easy for us to forget the issues that are important to us in the intervening times. Luckily for us, we have Smart Tips for Estate Planning  to remind us of those issues. This book is a great reference for Canadians on the topic. For me, it’s a keeper.

Have you started your estate planning process yet?