When we think about our legacy, we often consider the impact we want to leave on the world. A significant part of that legacy involves our financial assets.
Where does your money go?
These are the three places money typically goes when someone passes away:
- Loved ones: Children and grandchildren might use it to fund education or buy property, especially as housing becomes less affordable. For those without children, it could help other loved ones do things they otherwise couldn’t.
- Charity: A meaningful cause. Your legacy could provide children with access to education, healthy food and clean water.
- Taxes
How much would you like to go to each place?
Imagine your legacy as a bucket of water
I am a financial planner and work in a world that can be quite complicated. There is no shortage of acronyms: TFSA, RRSP, RESP, GIC, LIRA. The list could go on, but we’ve all got better things to do than swim in alphabet soup, so let’s make it simple.
Imagine the money you leave behind as water in a bucket. Most people want the people and causes they care about to get as much of that water as possible.
Proper estate planning ensures your wishes are fulfilled.
Without it, your bucket might leak. Imagine a loved one or charity picking up a bucket brimming with water, only to find it lighter and lighter as they walk to the tree they’d like to water. By the time they arrive, half the water is gone.
Why? They look down and realize the bucket was full of holes. These holes are inefficiencies that can exist in any estate plan. I’ve seen cases where over half of the water drips out before anyone gets to use it.
Plugging the holes
Time-tested strategies can plug those holes and ensure your legacy flows where you want it to.
Join my webinar Estate Planning for Widows and Singles, where I’ll explore the top three strategies every Canadian can use to maximize the impact of their legacy.