Estate planning for aunts and uncles
You don't have to be a parent to care about the next generation. People without children, from vociferous proponents of independence (http://www.dailymail.co.uk/femail/article-1166543/Childless-proud-Too-right-says-37-year-old-singleton-believes-having-children-wrecks-life.html) to those simply committed to other people's children, have one big reason to do some estate planning.
The Succession Law Reform Act (Ontario) has a default hierarchy of beneficiaries entitled to your estate if you die intestate and you may not be fond of that hierarchy. By default (without a Will), if you do not have a spouse or your own children (and your children's children are not living), your remaining assets will go to your parents and if your parents are no longer living, to your brothers and sisters, and if you don't have living brothers or sisters, to your nephews and nieces, and then to the next of kin. Note that "children" does not include fur babies.
To put the legislation into simple terms, your estate will go to your parents before it goes to your brothers and sisters and before it goes to your nieces and nephews. If that sequence sits well with you, fine; just as long as you are aware that you cannot guarantee that your parents or your brothers or sisters will keep enough aside from your estate for the younger generation.
So, aunts and uncles, before your nieces and nephews get your assets, there are at least three groups of people who will have first dibs. The way to avoid the default provisions in the legislation is to have a proper Last Will and Testament drafted and executed.
Once you have decided to get a Will done, here are some things to consider:
1. If married, do you want anyone other than your spouse to be a beneficiary? With living parents, for example, you may not want your spouse to receive all of your estate. If you want your nieces and nephews to be provided for, in tandem or in the place of your parents or siblings, then this must be clearly set out in your Will.
2. Are your nieces and nephews old enough to receive an inheritence? Much like having your own children, you may wish to consider that 30 is the new 20. Distribution of inheritence can be parsed up based on the beneficiaries age. If the beneficiary is not yet the age of majority (18 in Ontario), you need to designate the person who will receive and hold or manage the inheritence on the minor's behalf.
3. What if you are married and your spouse has five nieces/nephews on his/her side of the family and you only have one? Will you be dividing your estate between just your own blood nephews/nieces? All your nieces/nephews? Only one half of your estate goes to your spouse's blood nieces/nephews?
4. If you designate your sibling as the beneficiary, do you actually intend for your sibling to benefit from the estate or your nieces/nephews? If you appoint your sibling, there is no obligation to use the inheritence for the nieces' or nephews' benefit unless you make this clear in the Will.
5. Are your nieces and/or nephews outside of Ontario? If so, you may benefit from a provision in the Will that make it possible for your Estate Executor to distribute to beneficiaries outside of the province without having to post a bond.
6. Who will you appoint as an Estate Executor? Third party Executors such as banks, trust companies and even lawyers are often appointed when testators do not have their own children. People often turn to their children to settle their estates but third party Executors are often engaged where there is even a slight chance of estate litigation in the future. Just like advice to parents, if your nephews or nieces are not 18 or up, you cannot appoint them as Executors. If they are 18 or up, you may want to check with him or her whether they are ready for the role of an Estate Executor.
Of course, aunts and uncles have the same considerations even if they do have their own children but the considerations are especially important when there is no possibility of children helping in settling an estate.