If you're wondering why you should attend the next Wills & Trusts Seminar, especially if you've attended one in the past, wonder no more.
B.C. Schizophrenia Society Foundation (BCSSF) sat down with John Pin, Senior Manager from Solus Trust Company Ltd., to ask him about what people will learn from these Wills & Trusts Seminars.
BCSSF: Why should people attend a Wills & Trusts Seminar?
John Pin (JP): When facing death, we sometimes begin to think about the future of the people and organizations we care about the most. If you want to ensure your wishes are carried out, you need to provide instructions stating whom you want to receive which of your assets, what you want them to receive and when they are to receive it. You will, of course, want this to happen with the least amount paid in taxes, legal fees and court costs. That is estate planning—making a plan in advance and naming the people or organizations you want to receive the things you own after you die.
However, good estate planning is much more than that, it should include:
- Instructions for passing your values (religion, education, hard work, etc.), in addition to your valuables
- Instructions for your care, if you become disabled before you die.
- The name of a guardian and trustee for children under the age of 19.
- Provisions for family members with disabilities, without disrupting government benefits.
- Provisions for loved ones who might be irresponsible with money or those who may need future protection from creditors or divorce.
- Life insurance for your family at your death, disability income insurance to replace your income if you cannot work due to illness or injury, and long-term care insurance to help pay for your care in case of an extended illness or injury.
Good estate planning will also minimize taxes, court costs and unnecessary legal fees. What you need to remember is that it should be an ongoing process, not a one-time event. Your plan should be reviewed and updated as your family and financial situations (and laws) change over your lifetime.
We will outline some of the steps and considerations you would need to consider for a workable estate plan.
BCSSF: Why should people learn about trusts?
JP: Many adults diagnosed with a disability or mental illness like schizophrenia are entitled to income and health benefits administered by the Ministry of Social Development. The Ministry requires that monetary gifts and assets received by those getting these benefits need to be reported. However, if the gift or asset exceeds a particular amount, it may impact the benefits that the recipient receives monthly from the Ministry. If you plan to leave an inheritance for a loved one who is receiving these income and health benefit, it will be considered a gift and if it’s significant, the recipient could be cut off from these benefits completely.
However, it is possible to set up certain types of trusts without affecting a person’s ability to receive these benefits.
We will cover the characteristics of a discretionary testamentary trust and highlight its advantages.
Some of these characteristics and advantages include:
- The beneficiary NEVER receives the inheritance directly.
- The funds never belong to the beneficiary.
- An unlimited amount of money can be held.
- A trustee can make discretionary payments on behalf of the beneficiary within the limitations set out by the Ministry and your beneficiary will still receive their benefits.
- If a beneficiary qualifies for disability credit, the trust is subject to lower marginal tax rates.
- A fully discretionary trust cannot be claimed by creditors for debts incurred by the beneficiary, without the trustee agreeing to the payment.
- It protects against “undesirable” persons influencing the beneficiary to waste the funds or give money/assets away.
- The trust is protected even through personal bankruptcy of the beneficiary.
BCSSF: If people have attended a previous seminar, why should they attend this one?
JP: There have been many recent changes to the rules concerning qualifying payments from a trust to a beneficiary as it relates to income benefits and federal income tax changes to the taxation of trusts. We will cover these changes and more at the seminar.
At every seminar, attendees learn something new. They are also able to bring any of their own questions to the seminar and ask them at the end.
This is an invaluable resource that leaves people much better prepared for their twilight years. By making the plans now about how to protect your loved one, you can also plan to include gifts for organizations like B.C. Schizophrenia Society Foundation into the future.
If you're interested in attending the upcoming Wills & Trust Seminar in Surrey on Thursday, October 26 at 6:00 pm, call Cynthia at 604-270-7841 or email firstname.lastname@example.org.