Estate Planning

Estate Planning with

Mark Albert, CEA, EPC

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Mark Albert, a Certified Executor Advisor (CEA) and Elder Planning Counselor (EPC), specializes in comprehensive Estate Planning strategies, covering crucial strategies like probate minimization, tax-efficient asset transfer, as well as, Will, Executor, and Power of Attorney reviews for families and seniors. To help clients navigate these complex issues, Mark Albert offers valuable Estate Planning Seminars and one-on-one services across key regions in Southern Ontario, including the Niagara Region, the Peel Region, and the Halton Region.​

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To discuss your Estate Planning needs or to Book Mark Albert, CEA, EPC for an Estate Planning Seminar please inquire for availability at:

416-659-6655 or markalbertpfs@gmail.com

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When it comes to wealth, estate, legacy, and retirement planning for families and seniors, a comprehensive approach involves several key financial strategies:

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I. Retirement Income & Wealth Management:

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• Optimizing Government Benefits:

  • Strategically deciding when to start CPP (Canada Pension Plan) and OAS (Old Age Security) to maximize lifetime benefits. Understanding GIS (Guaranteed Income Supplement) eligibility.

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• RRIF/LIF Withdrawal Strategies:

  • Planning minimum and optimal withdrawals from Registered Retirement Income Funds (RRIFs) and Life Income Funds (LIFs) to manage taxable income and minimize OAS clawbacks. Consider tax implications of large withdrawals.

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• Pension Income Splitting:

  • For couples, splitting eligible pension income can significantly reduce the overall household tax burden.

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• TFSA Maximization:

  • Leveraging Tax-Free Savings Accounts for tax-free growth and withdrawals, which do not affect income-tested benefits. Ideal for emergency funds or supplemental income.

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• Non-Registered Investment Management:

  • Structuring non-registered portfolios for tax efficiency (e.g., maximizing capital gains over interest income where appropriate) and consistent cash flow.

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• Budgeting & Spending Plan:

  • Creating a detailed retirement budget that accounts for fixed expenses, discretionary spending, and potential increases in healthcare costs.

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• Longevity Risk Planning:

  • Ensuring sufficient capital to last a potentially longer lifespan than anticipated, possibly using annuities or structured withdrawals.

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II. Estate & Legacy Planning:

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• Will & Power of Attorney (POA) Review:

  • Regularly updating Wills to reflect current wishes, beneficiaries, and asset changes. Ensuring POAs for Property and Personal Care are current, clear, and understood by appointees.

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• Executor Selection & Preparation:

  • Carefully choosing capable and trustworthy executors, and providing them with organized documentation and clear instructions to simplify estate administration.

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• Probate Minimization Strategies (Ontario Specific):

  • Joint Ownership with Right of Survivorship:

    • For certain assets (e.g., primary residence, bank accounts), can bypass probate. Needs careful consideration of risks (creditors, loss of control).

  • Beneficiary Designations:

    • Naming beneficiaries directly on RRSPs, RRIFs, TFSAs, and life insurance policies ensures assets pass directly to heirs outside the estate, avoiding probate.

  • Trusts (e.g., Alter Ego, Joint Partner, Testamentary):

    • Can be used to bypass probate, provide privacy, control asset distribution, and offer tax advantages, especially for complex situations or large estates.

  • Gifting Assets During Lifetime:

    • Reduces the size of the estate subject to probate, but requires careful tax planning to avoid unintended consequences (e.g., capital gains on appreciated assets).

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• Tax-Efficient Asset Transfer:

  • Spousal Rollovers:

    • Assets transferred to a spouse upon death can defer capital gains tax until the spouse's death or disposition.

  • Estate Freezes:

    • For business owners, this strategy locks in the current value of business shares for tax purposes, allowing future growth to accrue to the next generation tax-efficiently.

  • Life Insurance for Estate Liquidity:

    • Using life insurance proceeds to cover final tax liabilities (e.g., capital gains on cottages, RRIF taxes), ensuring other assets don't need to be sold quickly.

• Charitable Giving:

  • Incorporating philanthropic goals through bequests in wills, direct beneficiary designations on insurance/registered funds, or using donor-advised funds for tax credits and lasting impact.

• Digital Estate Planning:

  • Documenting online accounts, passwords, and digital asset instructions.

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III. Long-Term Care & Incapacity Planning:

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• Funding Long-Term Care:

  • Assessing potential costs for home care, assisted living, or nursing home care, and developing strategies to fund these expenses (e.g., dedicated savings, Long-Term Care Insurance, leveraging home equity).

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• Health Directives:

  • Documenting preferences for medical treatment and end-of-life care to guide family and healthcare providers.

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IV. Communication & Family Dynamics:

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• Open Family Discussions:

  • Proactively communicating estate and legacy plans with family members to clarify intentions, manage expectations, and minimize potential disputes.

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• Statement of Wishes:

  • A non-binding document to explain the rationale behind decisions, fostering harmony.

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• Education for Heirs:

  • Preparing beneficiaries for managing their inheritance, if appropriate.

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These strategies often interlink, and their optimal application depends on individual circumstances, asset complexity, family dynamics, and provincial regulations in Ontario. Consulting with a qualified team, including a financial advisor (especially one with EPC and CEA designations), an estate lawyer, and an accountant, is highly recommended.​​​​​​​​​​​​​​​​

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To discuss further or for questions of clarification please contact Mark Albert, CEA, EPC at either:

416-659-6655 or markalbertpfs@gmail.com.

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The 7 Hidden Costs of Not Having an Estate Plan (Ontario Edition)​

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​​1. Excessive Estate Administration Tax (Probate Fees)

• In Ontario, the fee to "validate" a Will is called the Estate Administration Tax (EAT), commonly known as probate fees. Without a Will, or if your assets are not properly structured, your estate will likely have to pay this tax. The fee is currently NIL for the first $50,000 of the estate's value and $15 per $1,000 for the value over $50,000. While the EAT is mandatory for many estates, proper estate planning using tools like "Dual Wills" (for business owners) or carefully structured joint ownership can legally reduce the estate value subject to this tax following death.  

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• Basically, this is a mandatory, expensive cut the government takes from your assets to process your estate through the court. Smart estate planning tries to legally reduce this fee.

2. Lengthy and Costly Court Application for a Certificate of Appointment

• When someone dies without a Will (intestate), the person who steps forward to manage the estate (usually a relative) must apply to the Ontario Superior Court of Justice for a Certificate of Appointment of Estate Trustee Without a Will. This is the formal "probate" process. It's often lengthier, more complex, and more expensive than when a valid Will names a clear Estate Trustee (executor or executrix), as the applicant must gather documents, provide proof of kinship, and secure a surety bond (an insurance policy) in some cases—all draining time and money from the estate. 

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• In essence, if you don't have a Will, your estate gets stuck in a slow, expensive court process just to figure out who is legally allowed to handle your things.  Estate planning is crucial because it gives you control over what happens to your property and finances after you pass away.  Estate planning reduces the stress and complication for settling your estate.

3. State-Mandated Distribution via the Succession Law Reform Act

• Without a valid Will, the deceased's estate is distributed strictly according to the rules of intestacy set out in Ontario's Succession Law Reform Act (SLRA). These rules follow a rigid formula (e.g., first to the spouse, then to children, then to parents, etc.). This means your common-law partner gets nothing (as the SLRA only recognizes married spouses), your favourite charity is excluded, and estranged relatives could inherit your wealth—completely overriding your true intentions.

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• Essentially, if you don't write down your wishes, the Ontario government’s default rulebook takes over and ignores what you probably wanted to happen.  Estate planning is the only way to ensure your wishes are legally protected and that the people and causes you care about most actually receive your wealth.

4. Financial Paralysis Due to Lack of a Power of Attorney

• An Estate Plan isn't just about death; it’s also about incapacity. Without a Continuing Power of Attorney for Property and a Power of Attorney for Personal Care, if you become mentally incapable due to illness or injury, your family can't legally access your bank accounts or make key medical decisions. They must instead apply to the court to be appointed as your Guardian, a stressful, public, and expensive process that can take months, leaving your finances in limbo.

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• In short, without this simple document, a sudden illness can instantly lock down all your money, leaving your bills unpaid and forcing your family into a costly court fight.  As a part of doing proper estate planning everyone would have a valid Will in place, as well as a Power of Attorney for Property and Power of Attorney for Personal Care.

5. Court-Appointed Guardianship for Minor Children

• If you're a parent of minors, not naming a guardian in your Will forces the court to step in. Under Ontario law, any guardian named in a Will is only effective for 90 days after your death, requiring a formal court application to become permanent. Crucially, if you don't name one, a relative may have to petition the court to be appointed, potentially triggering family disputes and giving a judge—a stranger—the final say on who raises your children.

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• Fundamentally, no Will means you lose your voice, and the court decides who becomes your child's parent.  Creating a valid Will is a fundamental component of doing proper estate planning.

6. Exposing Inheritance to the Beneficiary’s Own Financial Risks

• If you leave an outright inheritance to a beneficiary (especially a young adult), that money is immediately subject to their own financial risks, including creditors, bankruptcy, or divorce claims under family law. A properly drafted Will that incorporates a Testamentary Trust can hold and manage the assets for the beneficiary's protection, shielding the inheritance from these outside risks and ensuring responsible management over time.

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• Put simply, without proper estate planning, your gift could end up paying off your loved one's ex-spouse or creditors instead of securing their future.

7. Unnecessary Income Tax on Capital Gains and Missed Deductions

• Death in Canada triggers a "deemed disposition" of your assets (like a cottage, investments, or rental property) at fair market value, often resulting in a large capital gains tax bill on your final income tax return. An Estate Plan allows you to use strategies like the spousal rollover (passing assets tax-free to a surviving spouse), or planning around the Principal Residence Exemption to minimize or defer the significant income tax liability that arises upon death.

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• Ultimately, when you die, the government taxes your estate on the profit from your assets. Good estate planning uses legal tools to delay or minimize that big tax bite, leaving more money for your family.

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The 4 Pillars of an Effective Estate Plan

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1. The Will & Asset Distribution (The After-Death Plan)

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• Purpose:

  • This pillar is the foundation for transferring your wealth and dictates your final wishes. It ensures your assets go to the right people, not according to default government rules.

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• Key Components:

  • The Last Will and Testament names your beneficiaries and appoints an Executor (Estate Trustee) to administer the estate. It also names Guardians for any minor children. Critically, it must align with your Beneficiary Designations for non-probate assets like RRSPs/RRIFs and life insurance, as these often override the Will. More complex planning may involve creating Trusts within the Will to manage inheritances for minors or those with special needs.

2. Financial Management (The Incapacity Plan)

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• Purpose:

  • This pillar protects your financial stability and ensures a trusted person can manage your money and property if you become incapable of doing so yourself. Planning for incapacity is as important as planning for death.

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• Key Components:

  • The core document is the Durable Power of Attorney for Property (or Financial/Assets), which grants a chosen agent (your "Attorney") the legal authority to handle transactions like paying bills, managing investments, and dealing with real estate. This authority starts immediately or upon incapacity and is durable, meaning it continues even if you are medically unable to consent.

3. Healthcare Management (The Incapacity Plan)

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• Purpose:

  • This pillar ensures your personal care and medical wishes are honored if you cannot communicate them due to illness or injury, relieving your family of having to guess or argue over life-altering decisions.

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• Key Components:

  • This is typically handled by the Power of Attorney for Personal Care (or Health Care Directive), which appoints an agent to make decisions about your medical treatment, housing, and personal welfare. This agent is guided by your Living Will or Advance Care Directive, which is a document that states your preferences regarding specific end-of-life care, such as the use of life support, resuscitation, and pain management.

4. Tax & Efficiency Planning (The Strategic Plan)

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• Purpose:

  • The goal of this pillar is to maximize the value transferred to your heirs by legally minimizing taxes and reducing the delays and costs associated with the estate administration (probate) process.

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• Key Components:

  • Strategies include optimizing Tax Minimization through tools like charitable donations or trusts to defer or eliminate capital gains. For Probate Avoidance, planners utilize techniques such as Joint Ownership and, in jurisdictions like Ontario, the use of Multiple Wills (Primary and Secondary Wills) to protect high-value assets (like a First Dealings property) from the Estate Administration Tax calculation. Regular, professional Review and Updates are essential to maintain the plan's efficiency as laws and life circumstances change.

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