Since getting married, my wife and I have been ticking all the traditional boxes that couples are meant to do to mark progress in our lives. We’ve bought a house, started a family and make an earnest effort to save money for our retirement. In addition to all the big boxes, we’ve actively tried to tick the small ones as well. We’ve painted rooms, changed fixtures and done both major and minor repairs to our home. We’ve purchased insurance, attempting to balance the twin pulls of simple and easy term insurance against whole life policies. Our growing family seems to incur a regular monthly unexpected cost, and there rarely seems a week when I am not heading to Home Depot to address some nagging issue that has suddenly come up. But with my second child expected within the coming month I realized that there was still something that neither my wife nor I had done; a will.
My conversations with clients regarding wills and estates are typically initiated with an older generation. It isn’t uncommon to find that people don’t have wills, or if they do, that they are hopelessly out of date. This makes logical sense, the older someone is the closer to death they are, and ensuring that their will reflects their wishes for their family and estate is important. This is especially true for people who have been divorced, have blended families or complicated estates that need tax protection.
But it is easy to forget that young couples, particularly those with children also need a will. If anything it is more important that a well thought out will is in place for young families, since an unforeseen accident should not mean that your spouse and children aren’t cared for in the manner you would want. But many young families don’t have wills, and they don’t have them for simple but largely stupid reasons.
Like insurance, getting a will done seems both like an enormous chore and an easily delayed one. There are lots of things to consider and a will means putting some real thought into what should happen to you if you were to die. Where are your assets? What should happen to them and who should get them? Who should care for your children? Should a trust be created? Who should be your executor? Does your will require a financial planner for the estate or assets (yes, I know that seems like a plug but I’m being serious)? Beyond simply answering these questions, you need to have this conversation with the people you name inside the will. All of this can seem quite laborious (or expensive), especially when you think you are too young to need such a document.
Dying without a will is also far worse than you may care to guess. No will means no say in who should raise your children. You have no way to designate your beneficiaries, no say over the financial future of your kids and your estate may pass to people you hadn’t intended on. More mundanely, you have no chance to improve the tax efficiency of your estate and the government will be setting the rules for what happens to your assets.
A study from 2012 suggests that more than half of adult Canadians don’t have a signed will. That number grows frighteningly when we look at younger Canadians, with 88% of them between the ages of 27-34 lacking a signed will.
The business of planning for a life after you’re gone may seem grim, boring and expensive, but it is a critical element of being a financially responsible adult. Young families owe it to their children, significant others and the legacy of their own hard work to ensure that an accurate and easily accessible will is part of their financial plans.