No financial plan is complete without an estate plan. Estate planning covers all aspects of your life, from creating your will to planning medical decisions. Due to the complex and emotional nature of estate planning, many people avoid creating or updating their estate plans. Though this is understandable, estate planning is essential to your financial plan. More importantly, it gives you peace of mind knowing your loved ones will be taken care of and your wishes followed. The following tips can help you address your needs when drawing up your estate plan.

1. Evaluate Your Priorities

First things first, consider your priorities. It may be succession planning for your small business, ensuring your spouse can live out the remainder of their days comfortably, or preserving family wealth over generations. You may also have multiple priorities that you’ll need to balance. Taking stock of your priorities upfront can help simplify the process. As decisions arise, you can make decisions that align with your goals and priorities.

2. Create Or Update Your Will

A will is not the sole piece of your estate plan, but it is one of the most important. If you don’t have a valid will, intestacy laws apply. This means your assets will go through probate and be distributed according to state legislation. This process eliminates your ability to control the distribution of your assets. Further, the process is more costly and time-consuming, requiring your loved ones to spend more time and money settling your estate.


Over time, your priorities and wishes will likely evolve, and your will should evolve with them. Any significant life changes, such as marriage, divorce, the birth of a child, grandchild, etc., should result in an update to your will. It’s also wise to periodically review and update your will to reflect any changes to your assets.

3. Include a Living Will

Estate planning is more than transferring assets to loved ones after you’re gone. It’s also about preparing for any unexpected events that may happen in your lifetime. A living will

designate a healthcare/mental power of attorney. It also clarifies your wishes in the case of life support or other medical procedures.

4. Designate The Right People

Estate planning involves designating individuals for many different roles: the power of attorney, executor, trustees, etc. These roles come with many responsibilities, so consider your designations carefully.

One of the most critical roles is your power of attorney. This person has the power to handle personal matters, covering everything from opening your mail to filing your tax returns. The executor of your will also plays a significant role in handling your estate. This person is responsible for “executing” the transfer of assets as specified in your will. If you choose to set up any trusts, you’ll also need to designate trustees for them. Finally, if you have minors, you’ll need to designate someone to care for them.


Ensure everyone you designate is someone you can rely on, and consider appointing two people for every position. Ideally, at least one of these individuals will be younger than you and live nearby.

5. Transfer Assets

When it comes to transferring assets, you have many options. The key goals are avoiding probate and minimizing the tax burden on your estate. Trusts and joint ownership are two great options to consider.

Trusts: There are two main types of trusts: testamentary trusts, which are established after your death, and inter Vivos trusts, which are established during your lifetime. The

appropriate trust depends upon the specific goal of your trust. If your children are minors and don’t have trust, the government will hold your property until they reach the age of majority.

Joint Ownership: Joint ownership may be a more convenient way to pass assets, such as accounts or property, on to an inheritor, but it can come with some unexpected complications. Work with a professional to ensure there are no unintended tax or probate implications. Start your estate planning Ottawa with Smith and West CPA.

6. Assess Your Taxes

Proper estate planning can help minimize some of the tax burdens. The more you can take advantage of tax strategies in your estate plan, the more you’ll be able to leave to your loved ones.


Preparing now allows you to take full advantage of any appropriate tax-saving strategies.

The recent “Tax Cuts and Jobs Act” may affect your estate plan. At the federal level, up to $11.18 million of an individual’s estate is exempt from federal taxation and $23.35 million

for couples. Depending on the state you live in, you may have to pay estate or inheritance taxes.

7. Talk With Loved Ones

Finally, once you’ve created your estate plan, it’s a good idea to have a conversation with your loved ones. This should include everything from logistics, such as where you keep important documents, to the type of funeral you would like. Having these conversations ahead of time can help prepare your loved ones and provide you with peace of mind.

8. Consider Leaving A Charitable Legacy

Providing financial support to groups that help the less fortunate is a great way to help disadvantaged people improve their quality of living and chances in life. Aside from making a big difference for the nonprofit organization you choose, leaving a charitable legacy can also help you in many other ways.

Charitable contributions are exempt from inheritance tax, lowering the value of your estate subject to inheritance tax. The remaining assets will subsequently have a significantly lower value, reducing the amount of taxes due. With this strategy, you can maximize the amount left to your beneficiaries.

Final Thoughts


Keep in mind that these suggestions are not meant to replace the guidance of a licensed financial advisor. Before making any estate planning decisions, consult a financial advisor, an estate planning attorney, and a tax specialist to ensure you have the most current and correct information and advice. These financial experts can explain and execute your estate planning goals, giving you and your loved one’s peace of mind for the future.