Tax & Estate Planning: Strategies

Estate planning is the process of developing and maintaining a plan that will preserve your accumulated wealth and ensure an effective and beneficial distribution of your assets to your heirs. Whether your goals are to ensure your dependents are financially secure or to implement effective tax-planning strategies, every estate plan is unique. Throughout the process of developing an estate plan, you should be working with a team of professional advisors, specialized in the areas specific to your needs.

When it comes to estate planning, strategies to achieve your goals range from simple to complex. Overall, estate planning objectives may be grouped under four key headings: financial objectives; provision for family; plans for disposition of an estate; and philanthropy.

Before you begin, you need to decide what you wish to accomplish. Some strategies that you may wish to consider include: designating beneficiaries; registering property jointly, and establishing trusts. While estate planning is a significant commitment, you can rest assured that you have a plan in place. A professional Investment Advisor can assist you in developing strategies that will properly reflect your situation.

Determine Your Objectives
Depending on where you are in your life cycle, the estate planning process will mean something different to each of you. You may be at the stage when planning your retirement is your most important financial objective, or you may want to focus on providing for the needs of your family. Generally, estate planning objectives can be defined in many different ways.

Let's review the four key objective categories, as follows:

Financial objectives
Many times, the financial obligations of your estate are overlooked. If you want to ensure that your estate is distributed according to your wishes you'll need to ensure you've made adequate provisions in your planning. Have you taken steps to ensure that your plans include tax-effective strategies? Further, do you have enough liquid assets to cover your potential tax liability?

Provision for your family
Providing for your spouse and dependents is often the motivation for undertaking estate planning. Not only do you need to consider provisions for joint death in your planning, you also need to appoint a guardian for your children. Do your plans ensure that your family will be able to maintain their current lifestyle should something happen to you?

Plans for disposition of your estate
Considering how to bequeath your assets is also an important part of establishing your estate plan. Trusts are quickly gaining popularity as a way to ensure family members are provided for. Have you listed your family heirlooms and personal property for giving to specific individuals?

Philanthropy
Charitable giving plays an important part in many estate plans. Canadians give generously to charitable organizations. The recent changes by the Canada Revenue Agency are making charitable giving easier for many Canadians. Would you like to make provisions to support your favourite charity?

You need to decide what you wish to accomplish: minimize and defer taxes; provide adequate liquidity in your estate to provide for taxes; bequeath your property and holdings either intact or in cash. The estate planning objectives and subsequent strategies available to meet your goals vary from the simple to the complex. A professional Investment Advisor can assist you in developing a plan to best suit your personal situation.

Daniel Saikaley, CA CFP EPC
Investment Advisor
CIBC Wood Gundy
E-mail: daniel.saikaley@cibc.ca.
Website: www.danielsaikaley.com.