In my estimation, it takes approximately 6 hours of your time to create a thoughtful Will. This time estimate includes the time it takes to think about various appointments and gifts and the time required to meet with and instruct a lawyer and to execute the Will once it is in final form. Once you’ve invested this kind of time, you might wonder where is the best place to store the Will? It is a crucial decision because if the Will cannot be located on your death, you may as well not have had one.
Some common places to keep a Will include:
(1) The lawyer’s office. Your lawyer will likley offer to keep your Will for you for free. Most lawyers have exceptionally good document storage facilities and also carry “valuable papers” insurance. Your privacy is assured because family members cannot access the Will there. You may worry about the longevity of the law firm and what will happen in the event the firm closes before you pass away? The Law Society of Upper Canada has procedures in place to cover this scenario. When I hold Wills for clients, I ask the testator to advise their executor that they have prepared a new Will and that the original is being stored at our office.
(2) At home. While this is certainly a convenient, no cost option, you should be aware of the risks of storing your Will at home. Your Will could be damaged or destroyed by a fire or flood. Someone in your home could inadvertently/accidentally or even intentionally destroy your Will. Family members may not be able to find your Will at home, particularly if your important papers are not well organized. I have one client who habitually stores important papers in a plastic shopping bag behind her couch! If you do opt to keep your Will at home, invest in a safe or lockable document storage box which offers some fire-protection. Let your executor know the whereabouts of this box.
(3) Safety deposit box. Most banks and credit unions have safety deposit boxes available for customers to use. Some even offer this service for free in certain circumstances. Banks and credit unions are specifically designed for the long-term storage of money, documents and valuable goods. Storing your Will in a safety deposit box does ensure your privacy because only the box owner has access to the box during your life time with the flexibility that the named Executor(s) may have access after your passing provided they produce a death certificate and proper identification. Check with your bank about what their requirements would be on your death.
A special note about the storage of Powers of Attorney documents – please do not store these documents in a safety deposit box at a bank or credit union. The named Attorney may not be able to access the box to retrieve the very document that gives them legal authority to deal with your assets. The best location for these documents are either in your own home in a locked box or at your lawyer’s office with an escrow agreement in place.
As you can see, the decision as to where to store your Will is an important one. Where is your Will now? Are you satisfied with this location?
Since everyone knows “you can’t take it with you”, small business owners know that, at some point, they are going to leave their business. Although it can be a difficult topic, it’s never too early to start the planning process. The attention and hard work of owners over the course of a life-time often results in a successful business with substantial value when the owner is ready to cash in. The hard question is: when is the right time to sell? It’s a very personal decision but here are some things to consider:
(1) Is the owner mentally/emotionally ready to retire? Sometimes an owner can’t imagine doing anything else or can’t accept that someone else could run the business successfully without them. Finding a successor the owner has confidence in makes the transition easier.
(2) Does the owner have a retirement date/age in mind? If so, two to three years ahead of that date is not too soon to start the process. It takes time to find a buyer, negotiate a deal, close the deal and transition the staff and customers to the new owner.
(3) Has the owner experienced a recent health challenge? If so, the decision to retire/sell may have come sooner than expected. If the owner’s health permits, he/she should be involved in the process. This is not an ideal time to sell and value may be lost due to time pressures.
(4) Is the owner overwhelmed by changes in the industry, finding it hard to keep up to date? Technological and regulatory changes can be challenging to stay on top of and take the pleasure out of owning a business.
(5) Has an obvious successor/buyer been identified? Perhaps a competitor has made an offer to purchase the business? Often value is maximized in this scenario.
(6) Are market conditions ideal for a sale? For example, will a buyer be able to afford financing? Is growth in your industry expected to continue?
Value can be maximized when a plan is put into place early, rather than responding to an unexpected turn of events. Tax advice is vital and often requires advanced planning to maximize the net proceeds for the owner. Succession planning is a process, not an event, so schedule some time on your calendar before the end of the year to review your plan!
According to the Canadian Real Estate Association (CREA), home sales across Canada declined slighly in July. Resale homes were down marginally by 0.01 per cent from June. Although prices were higher than the previous year in 7 out of 10 markets, falling sales in the greater Vancouver area drove the national average down. The Canadian average price for homes sold in July was $353,147.00, down 2 per cent from July last year. These figures support predictions by the Canadian Mortgage & Housing Corporation that there will be a moderate slow down in both new home construction and sales of used homes. Various factors are to blame, including affordability, the exhaustion of pent-up demand and tightened mortgage lending rules.
Locally, the real estate market is stronger than it is nationally. The most recent statistics available are from the first quarter of 2012 and are compiled by the Realtors Association of Grey Bruce Owen Sound. Real Estate sales were up 27 per cent in the first quarter. The average selling price was $385,054, up 8 per cent over the previous year. The value of building permits issued in the first quarter was also up substantially – 76 per cent higher than the first quarter of 2011. We certainly hope the positive trend continues!
The Law Society of Upper Canada has recently launched a new “Access to Justice” initiative to assist people who are dealing with a family breakdown. The website, www.yourontariolaw.com, provides comprehensive information in plain English and is meant to be a first stop for people searching for family law guidance. The website has sections specifically tailored to parents, children and grandparents. There are helpful checklists, definitions of legal terms, diagrams, links and videos. Often what people need when a family crisis arises is information they can count on, from a reliable source. We recommend the site!
Ottawa made two changes recently to Canada’s mortgage rules in an effort to cool the housing market. First, lenders can now only issue home-equity loans up to 80% of a home’s value (down from 85%). This means home buyers have to come up with a larger down payment than before. Second, the maximum amortization period was reduced from 30 years to 25 years. While this will reduce the overall amount of interest borrowers will pay over the life of the loan, it requires home owners to be able to pay more each month in mortgage payments. These changes are expected to have a significant impact on the housing market.
Welcome to our new website! We are very excited about our fresh new “look” and hope you like it too! Please check in with us regularly to see our musings, rants and commentary on topics related to the law generally and more specifically to our practice areas. Thank you for your interest and we welcome your suggestions and comments. Stay tuned!