The modern Canadian family looks very different than it did 50 years ago. Family dynamics are more complex and it makes inheritance planning a difficult task for most people.
“In Canada, 12.6% of all families with children aged 24 or less – more than 460,000 Canadian families – are stepfamilies.” – Estate planning for complex family dynamics, BMO Wealth Management
Recently, BMO Wealth Management commissioned a survey to ask Canadians about their views on inheritance planning and the surrounding discussions. It revealed some interesting statistics that are important for all Canadians to know, as well as some practical next steps for those who have yet to create an inheritance plan.
How Many Canadians Receive an Inheritance?
Canadians were asked in the survey whether they had already received, or expected to receive, an inheritance from their parents.
60% of those surveyed indicated that they had received an inheritance.
15% considered the amount that they had received to be significant.
31% of those surveyed expected to receive a future inheritance, with younger respondents less likely to expect an inheritance.
How Many Canadians Plan To Leave An Inheritance?
Canadians were also asked if they planned to leave an inheritance and to whom they would give their estate assets.
32% of Canadians planned to leave assets to their spouse and their children.
Only 7% of Canadians who are either separated or divorced plan to leave their assets to their children and current spouse.
41% of common-law Canadians will leave assets to their spouse and their children.
Do Canadians Discuss Inheritance With Their Family?
Despite the immense importance of the topic, people find it difficult to discuss inheritance planning. The BMO Wealth Management survey asked Canadians just how many parents shared their estate distribution plans or details of their wills and executor selections.
Only 30% of respondents stated that they have had these open discussions with their parents.
If the parents were separated or divorced, they were less likely to share their inheritance intentions, estate plans, or wills with their children.
Next Steps for Canadians
If you are among the Canadians who have not created an inheritance plan, you can follow these steps to create one now.
Download the ERAssure Inheritance Planning Guide.
This professional guide will help lead you step-by-step through the inheritance planning process. It can be downloaded for free right here.
Choose an Executor
This is one of the most critical steps in the inheritance planning process. Consider who you select very carefully, especially if you are selecting all of your children. Once you’ve selected an executor, remember to provide the key information on where to find your will when it is required.
Review Your Will
Once your inheritance distribution plan is finished, it is important to include it in your will. Contact a professional to assist in administering any will changes, especially if they are done later in life.
Advise Your Future Executor to Purchase Executor and Estate Insurance
This step can be written into your will. By advising your future executor to purchase executor and estate insurance, your executor will be protected against any of the inherent risks of the role.
If you’re looking for more help with inheritance planning or understanding the role and responsibilities of an executor, please visit the ERAssure.com resources page for more information and practical guides.