How will you be remembered? Making a Difference in the Lives that Follow April 26, 2014 Presented by: Ross Young, CA, CFP Strategy Wealth Advisors

Outline Hierarchy of Needs Death and Taxes Dying Intestate vs. Dying with a will Leaving a Legacy – with family and charity Taxation of Charitable Donations Strategic Charitable Gift Ideas E.&O.E 3

Maslow’s Hierarchy of Needs 4

Death and Taxes On death you are deemed to have disposed of all capital property for it’s fair market value Rollover available for spouse, common law partner or spousal trust RRSPs – fully taxable Marketable securities – capital gains Shares of private company – capital gains If death between Jan & October, taxes due April 30 th otherwise 6 months E.&O.E 5

Wills vs Intestate 56% of Canadians do not have a will Can’t choose beneficiaries Can’t choose who administers your estate Can’t plan to minimize taxes Can’t choose guardian for children E.&O.E 6

Example – Andy & Michelle Andy and Michelle both on second marriage – each have children Andy dies, Michelle dies six months later, neither have a will What are the consequences? E.&O.E 7 Mrs. Andy Michelle Family

What makes a valid will? Must be made in writing Must have signature of testator and be clear that it was intended to be a will Formal Will – signed in front of two witnesses and two witness sign in front of testator Holograph Will – completely in testator’s handwriting and signed by testator Military Will – member of Canadian Forces on active duty can make a will by signing it E.&O.E 8

Options for Wealth Distribution 9 All Assets Mr.Mrs. CRA Family Community (Charity) 1.Three beneficiaries of all assets 2.Structure estate so majority of assets to charity and family 3.Least amount possible to CRA E.&O.E

Leaving a Legacy Importance of passing on values, wisdom and stories to future generations Consider creating a document aside from the will that discusses these items Reflection on history and who and what was important in your life Philanthropy – from Greek word philanthropos – meaning humanity, benevolence or loving of humankind Contributing our time, our talents and our financial resources to make a difference E.&O.E 10

Taxes and Charity Donations under $200 Federal tax credit – 15% Provincial tax credit – 10% Total tax credit – 25% Donations over $200 Federal tax credits – 29% Provincial tax credit – 21% Total tax credit – 50% E.&O.E 11

Strategic Charitable Gift Ideas

Charitable Bequest Most common way to leave a planned gift Consider leaving residue of estate to charity – ensures family is taken care of Consider donation of RRSPs to eliminate tax on death E.&O.E 13

Opportunity – Gift of Securities Gift of $100,000 cash – Net cost - $50,000 Gift of $100,000 securities $0 Cost base - $50,000 tax credit, savings of $19,500 on capital gain avoided Mrs. E.&O.E 14 Mrs. Charity $100,000 $50,000 Cash Tax Credit Net Cost$50,000 Stock $50,000Tax Credit $19,500Capital Gain Savings $30,500 Net Cost CashStock

Summary Hierarchy of Needs Death and Taxes Dying Intestate vs. Dying with a will Leaving a Legacy – with family and charity Taxation of Charitable Donations Strategic Charitable Gift Ideas E.&O.E 15

Questions Ross Young –