Estate planning checklist can help you prepare for the road ahead

By Holly Allardyce, LLB 
MD Financial Management

Since the start of the COVID-19 pandemic, we at MD Financial Management have noticed an increased interest in estate planning — and understandably so. Many physicians are seeing the risks posed by COVID-19 to themselves and their families and are thinking more about their mortality. 

Whether you are creating an estate plan for the first time or updating your existing plan, the following checklist can help guide you in making the necessary arrangements to safeguard your family’s future and to ensure your estate is distributed according to your wishes in the event of your death. 

1. Will

Your will sets out how your assets are distributed and who is nominated to handle your affairs.  

Your assets 

• Keep an up-to-date list of your significant assets and note the location if outside your province or the country. 
• Are there any specific items you want to leave to a specific person? 
• Where possible, do you want assets to pass outside your estate to avoid probate fees (e.g., an insurance policy, an RRSP)? If so, do this via the asset’s beneficiary designation. 

Your beneficiaries 

• Who will inherit your assets? 
• If they are minors (or others who may mismanage an inheritance), do you have a trust or other provisions in place? 
• Is the list of beneficiaries in your will up to date (e.g., have there been births, deaths or marriages in your family)? 
• Have you included alternates in case your named beneficiaries predecease you? 
• Do you want to give to charities or other organizations? 

Guardians (if you have minor children) 

• Have you spoken to your prospective guardian(s) to be sure they are willing? 
• Do they have the physical health and financial means (beyond what you may leave) to raise your child? 
• Did you include an alternate in case the guardian you chose is unable to commit? 

• Review your choice of guardian as your child grows older. 

Your executor*

An executor administers your estate and carries out your wishes after you die. You will need to name an executor, or two or more co-executors. Be sure to name one or more alternates as well. 

• Is the executor capable of carrying out the responsibilities? 
• Do they have the time? A simple estate settlement can take as much as 250 hours of direct involvement. 
• Does this person live in the same city? It is a lot more costly, time-consuming and inconvenient if they have to travel.  
• Did you speak to your executor to be sure they are willing? 
• Does your executor know where to find your important documents? 
• Will they be capable of dealing with your medical professional corporation? 

*An “executor” is called an “estate trustee” in Ontario. 

2. Power of attorney

A person acting under a power of attorney document is someone who can make decisions on your behalf, usually when you’re incapable of doing so. More specifically, a continuing (or enduring) power of attorney for property document names the person who will manage your financial matters, while a person acting under a power of attorney for personal care document makes decisions about your health care needs. 

• Do you understand what it means to give someone power of attorney? 
• Did you name an alternate in case the person you chose is unable to serve? 
• Does the person you chose understand your wishes? 
• Does the person you chose know where you keep your important documents? 
• Do you want to specify a triggering event, such as a declaration of incapacity, for your power of attorney document to become effective? (Once the document is signed, the person acting under the power of attorney could have immediate control.) 

3. Life insurance

Life insurance protects the financial security of your family and helps them maintain their lifestyle after you die. It can also help pay the taxes and other liabilities that will arise on your death. 

• Do you have life insurance? If so, is it adequate? 
• Make sure the beneficiaries you designated on these policies are not out of date. 

4. Funeral wishes

• Do you have specific wishes for your funeral? 
• Do you want to be buried, cremated, or have your body donated to medical science? 
• Inform your family of your wishes – do not rely on your will to convey your wishes since it may not be read until later. 

5. Financial planning

• Do you have an idea of what your tax bill will be at your death? What about probate fees? 
• Have you thought about how you can minimize some of those taxes? 
• Have you set aside enough money to pay for taxes, funeral costs and other expenses? 
• Do you have a succession plan for your medical practice? 

6. Digital assets

From bank accounts to your Facebook page, your so-called “digital assets” will need to be dealt with when you die or if you become incapacitated. 

• Compile a list of your digital assets, such as financial accounts, social media and email accounts, data stored on computer hardware, etc. 
• Specify in your will how you want social media accounts handled. 
• Tell a few people (e.g., family member, lawyer, executor) where to find the key document containing your passwords. 

To get started on your estate plan, or to update your existing plan, speak to your financial advisor and a lawyer. If you need a lawyer, visit the referral service from the Law Society of Ontario.

Holly Allardyce is an assistant vice-president and senior legal counsel at MD Financial Management.  

Insurance products are distributed by MD Insurance Agency Limited. All MD employees dealing with clients regarding insurance products hold life licences. Estate and trust services are offered through MD Private Trust Company. The information contained in this document is not intended to offer foreign or domestic taxation, legal, accounting or similar professional advice, nor is it intended to replace the advice of independent tax, accounting or legal professionals. Incorporation guidance is limited to asset allocation and integrating corporate entities into financial plans and wealth strategies. Any tax-related information is applicable to Canadian residents only and is in accordance with current Canadian tax law including judicial and administrative interpretation. The information and strategies presented here may not be suitable for U.S. persons (citizens, residents or green card holders) or non-residents of Canada, or for situations involving such individuals. Employees of the MD Group of Companies are not authorized to make any determination of a client’s U.S. status or tax filing obligations, whether foreign or domestic. The MD ExO® service provides financial products and guidance to clients, delivered through the MD Group of Companies (MD Financial Management Inc., MD Management Limited, MD Private Trust Company, MD Life Insurance Company and MD Insurance Agency Limited). For a detailed list of these companies, visit md.ca. MD Financial Management provides financial products and services, the MD Family of Funds and investment counselling services through the MD Group of Companies.