Rubach Wealth Blog

When a spouse or parent dies: providing support through estate planning

April 24, 2017

This is not a fun exercise, but it is an important one: imagine that you have recently passed away. Now put yourself in the shoes of your spouse or children who have survived you.

First and foremost, they are grieving. If your death was unexpected and sudden, they may also be in shock. In the days following your death, other emotions may be added to the list: confusion, summed up in the question “what happens now?”, and worry, with surviving family members wondering

“How will we manage financially now that you’re gone?”

When a spouse or parent dies_ providing support through estate planning - 2017.04.25

The grief, shock and sadness are all natural reactions that cannot – and, arguably, should not – be avoided. On the other hand, the confusion and worry can and should be mitigated as much as possible. Fortunately, you can take active steps today to minimize the potential for this added stress at a time when your family is already grappling with a great loss.

The time for estate planning is now

An estate plan provides a map for your surviving family members outlining how you would like your personal and financial affairs managed after you die. It also serves as a guiding strategy during your lifetime, helping you make the most of available legal, financial and tax tools in order to preserve your wealth, provide for your family and build your legacy.

However, the thing about plans is you have to make them ahead of time. Putting off estate planning until you’re old or sick is a bit like waiting until the last minute to book your dream holiday: you may luck out and snag a great deal, but you’re more likely to end up squished into a middle seat flying to a dodgy resort, or perhaps not being able to go on holiday at all.

The process of creating an estate plan is highly personalized, but in general it includes the following elements:

  • Identifying your priorities
  • Creating a will
  • Designating beneficiaries
  • Designating a power of attorney and executor
  • Planning for taxes
  • Organizing all important documents

Some of these steps you may not be able to do right away and some elements may require updating over time. However, the important thing is to make a start. Having an estate plan that evolves over time is natural; having no estate plan at all is like rolling the dice and hoping for the best. Starting sooner rather than later also gives you a longer period to benefit from tax-saving strategies, which can make a significant difference in long-term estate preservation.

Death doesn’t happen on schedule

Death can happen unexpectedly, but what to do when a spouse or parent dies shouldn’t be a surprise. If you were to die tomorrow, would your spouse or children know where to start when it comes to making sense of your financial affairs?

Anyone who has been in this situation can relate to the horror of stepping into a home office or opening a filing cabinet and realizing that they have no idea what to do and what to look for. This is where estate planning can help to ease the confusion and worry. If you have developed a comprehensive estate plan, your spouse and children will be spared some of this stress as there will already be clear steps in place for them to take. Depending on your personal situation, these steps may include:

  • Contacting your lawyer
  • Contacting your financial advisor
  • Calling CPP to arrange death benefits

Having a clear and comprehensive estate plan is also critical to avoid litigation. If you pass away without a will or if you fail to identify a clear beneficiary for every single asset, your estate could very easily end up in court – bogged down by lawyers, legal fees, delays and fighting. Litigation is ugly, expensive and undignified, so clearly not something you want as part of your final legacy.

It all starts with communication and planning

Nothing aside from time and support from family and friends can ease the pain of losing a spouse or parent, but it is possible to ease the stress of dealing with such a loss. By ensuring an estate plan is in place, you can give your spouse and children peace of mind and a clear path forward at a time when they are likely feeling lost.

However, it is important to recognize that estate planning goes beyond the formal elements like creating a will and designating an executor. It also includes sitting around the kitchen table speaking openly about your wishes in the event of a serious illness and your preferences regarding funeral plans. It includes ensuring that your spouse and children know where to find property deeds, account numbers and other important information about your assets. And it includes sharing your hopes and worries for the future. Whether these issues come up naturally in conversations with your loved ones or you organize a family meeting specifically to talk about them, what’s important is that you have these discussions.

Thinking about your own mortality can be grim business, let alone planning ahead for your eventual death. However, when viewed as an opportunity to ease the emotional stress your family will face when you die, suddenly the importance and value of estate planning become clear.

Lawyers play a big role in preparing the legal components of an estate plan, but in general they are focused only on executing your instructions. In contrast, financial advisors can work with you to guide the process of estate planning and develop strategies that match your needs. At Rubach Wealth, we can help you build a robust estate plan to ensure that your family is well taken care of now and in the future, come what may. Contact us today to discuss how we can support you and your family.

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