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The Enlightened Investor: A client estate planning story…

The Enlightened Investor: A client estate planning story…

Recently a client who resides in BC encountered a serious health issue. They and their spouse began to doubt the adequacy of their Will and estate planning. The Will named an adult daughter as executor and the client’s older brother as a contingent executor. Now they questioned their child’s acumen for settling an estate and how she might spend the inheritance. As well, the contingent executor is a similar age as the couple and has significant health concerns of his own.


I asked my clients if they had considered a corporate trustee? They had and were interested in learning more. This led to an introduction to Sorrell Private Trust in Edmonton. Through their discussions with Sorrell my clients learned that trusts were not necessary for their situation and that naming Sorrell as their corporate executor would alleviate many concerns.


One interesting estate planning strategy that came out of the discussions was to name Sorrell Private Trust as the contingent beneficiary on ‘registered accounts’ such as their RSP and TFSA. By doing so, these assets will avoid the 1.4% probate fee charged in BC at the time of the second death potentially saving $9,000. For reference consult the BC Wills, Estates and Succession Act, section 92, ‘Trustee for designated beneficiary’.


Once the planning was complete Rhonda Johnson of Duncan Craig LLP was asked to update the Will naming the new corporate executor and expressing the revised wishes of the clients. Based on the advice of the estate professionals the clients instructed me to add the Trust company as the contingent beneficiary on their registered accounts.


Before and after. Before the planning was completed these clients were worried. They were waiting for test results with serious implications and they had important questions about their estate planning without any answers. After the updated estate planning was put in place they expressed relief. They felt that their estate would be administered by a professional Trust company when one or both of them pass away. This alleviates a grieving family member from the burden of settling an estate or from making costly mistakes due to inexperience. In particular, they loved the coordination between the Trust company, the lawyer and their portfolio manager. And the medical results came back good!


The administration of an individual’s estate has become increasingly complex owing to the increased diversity of property, investments and changing laws. Typical tasks of an executor, who may be grieving the loss of a family member, may include:


  • Making funeral arrangements
  • Determining all of the estate assets and liabilities as at the date of death
  • Listing contents of a safety deposit box
  • Make application for all benefits payable to the estate, including death benefits, life insurance, pensions and annuities
  • Advertise for creditors and claimants
  • The creation and maintenance of records and communication with the estate beneficiaries on a regular basis
  • Application for the applicable grant required to administer the estate
  • Preparation of financial statements
  • Paying the estates debts and obligations
  • Preparation and filing of the deceased’s tax return(s)
  • Preparation and filing of the estate and ongoing trust(s) tax return(s)
  • Obtaining the applicable tax clearance certificates
  • Administering any testamentary trusts created under the Will
  • Distributing and accounting for the estate property in accordance with the Will


Chris Turnbull CFA, CFP, TEP, is an independent Portfolio Manager at the Index House, specializing in passive index portfolio management.