Mikestrathdee’s Blog

Write a will now – for your family’s sake
January 21, 2011, 9:57 pm
Filed under: Communication, Estate Planning, Financial Management, Marriage, retirement

published in Christian Week Ontario November 2009

If you die tomorrow, would you leave behind a headache for your family?

Nearly half of Canadians have never made a will. Many more have never completed other documents that could save their family a lot of grief in the event of a tragedy. Only 21 per cent of Canadians under 35 have made wills, according to a national study conducted for FLA Group.

Young families may think estate planning can wait. But failing to name guardians for your minor children means that if both parents die, a judge could award custody to the family members you would least want your children to live with. Having the main breadwinner die without a will in place will lead to headaches, and likely financial hardship, for the survivor.

In Ontario, the estate of a person who dies without a will, leaving a spouse and one child, the first $200,000 goes to the spouse. Any balance will be divided equally between the spouse and child.  As minors can’t inherit, the child’s share will be held in trust until the child is 18. If the deceased leaves a spouse and more than one child, any balance (over $200,000) would be one-third to the spouse and two-thirds (in trust) to the children.

Even at age 18, many young people are not mature enough to make good choices about an inheritance. If you don’t make a will, your children receive their entire inheritance at 18.

My most vivid memory of a decade spent doing estate planning seminars and personal counselling involves a Sunday afternoon session in a small town’s biggest church. After I questioned the wisdom of letting children inherit at age 18, a young woman jumped up and said: “I agree with you completely. That’s a bad idea.”

Later on, she told me a sad story. When her father died, she and her brother were each left $60,000, payable at age 18.  Her brother wrecked vehicles, ran up debts and left a string of unpaid bills in the two years it took to deplete his share. She did a little better, but was determined not to repeat the mistake with her own children.

You should also prepare for the bad things that can incapacitate us without killing us. If you aren’t able to conduct your financial affairs and have never had a continuing power of attorney for property prepared, “a potential nightmare awaits the family,” Fish and Kotzer suggest in their book The Family Fight – Planning to Avoid it.

A Cambridge couple lived that nightmare earlier this decade. When the husband suffered a stroke, his wife found herself unable to complete the sale of the family home, yet needing that money for a condo they had purchased. His share of the home sale was held for a time by the Public Guardian and Trustee. It cost her a lot of grief and money to get the situation resolved.

Do your loved ones a favour –have a will and powers of attorney drafted ASAP.


Money and Marriage
January 1, 2009, 5:47 pm
Filed under: Communication, Debt, Financial Management, Marriage
Money and Marriage
From the Jan. 8, 2007 issue of Canadian MennoniteMoney and marriage

—Mike Strathdee

Money problems are a leading cause of failed marriages, the cable TV series Til Debt Do Us Part suggests. In the program, Canadian author Gail Vax-Oxlade works on financial makeovers for couples who are in over their heads, unable or unwilling to agree on how to make things better.

As many as 90 percent of all marriage breakdowns relate to money problems of one sort or another. So why is the discussion of financial issues in pre-marital counselling and marriage renewal courses often relegated to the margins, glossed over or neglected altogether? Even the Marriage Course, an eight-session video study produced by the people who put together the Alpha program, fails to give serious attention to issues around family life and mammon. Money is the greatest cause of arguments in marriage, the course mentions in passing, then moves on to the next topic.

In a society in which almost all of the financial messages that people receive are “spend, spend, spend,” if Christian communities don’t have strong voices urging couples to live frugally and model the nitty gritty of positive choices, it is almost as if we’re silently affirming the culture. Vax-Oxlade cites statistics indicating that 70 percent of people spend more than their gross income every year.

An article in Psychology Today noted that most adults—67 percent of women and 74 percent of men—enter marriage with at least some debt. Far fewer have a plan on how to deal with the situation, or an understanding of the negative effects the unacknowledged presence can have on their household. This can compromise what Scott Stanley calls the three important elements of safety in relationships:

• The ability to talk freely,

• Safety from physical harm, and

• A sense of security about the future.

Shared understandings around the use of money—who pays for what, when do I need to check in about a proposed purchase—need to be talked through early and often to avoid resentment and mistrust. Too often, the conversations needed to develop a common philosophy around spending, saving and giving don’t happen. Remaining stuck in family-of-origin patterns around finances, be they unhealthy hoarding or compulsive spending, can be equally damaging to a partnership.

Challenges to face and deal with these issues are absent from pre-marriage counselling, in some cases because pastors feel rushed, uncomfortable or ill-equipped to address the topic. Yet these transitional milestone times provide opportunity for introducing new thoughts and approaches, to encourage communication and full disclosure as cornerstones of relational health.

When a colleague and I did a presentation on marriage and money to a group of recently and soon-to-be wed couples this fall, we noticed several things. All of the participants did their pre-work and eagerly received resources offered for them to take home. The common theme in post-event evaluations was a desire for more conversation, both as couples and in a group setting. There can be considerable power and healing in shared stories of strengths and struggles.

Can we take the time and make the space in our congregational communities, in livingrooms and other settings to allow these conversations to multiply and flourish?

Mike Strathdee, CFP,  is a stewardship consultant at the Kitchener, Ont., office of Mennonite Foundation of Canada (MFC). For stewardship education, estate and charitable gift planning, contact your nearest MFC office or visit mennofoundation.ca.

Why it’s important to have Powers of Attorney in place
January 1, 2009, 5:42 pm
Filed under: Communication, Estate Planning, Marriage, retirement
From the October 1, 2007 issue of Canadian Mennonite
Failing to planMike StrathdeeMost of us put off preparing for worst-case scenarios. But changes in what health care and financial institutions require of clients means that there are many good reasons to get our affairs in order—for the sake of those we love, if nothing else.

People generally don’t realize the need to have valid Powers of Attorney for Health Care (known in some provinces as advanced/health care directives, living wills or proxy directives) in place, so someone can advocate for them if they can’t speak for themselves.

A recent Royal Bank survey found that only about 48 percent of adult Canadians have wills. A chaplain at a hospital in Kitchener, Ont., says his guess is that as few as 5 percent of the people he works with have a valid power of attorney.

Increased concerns about liability, and the fear of being sued, lead health care professionals to take a hard line on the issue of informed consent to treatment. If a tragedy left you unable to express your wishes, would you want to leave the decisions on treatment in the hands of people who may not know your values?

Here are a few stories about what can go wrong.

A few years ago, a Kitchener lawyer gave an example of the extra stress that can result from a lack of preparation. A woman went to check on her elderly mother, and found her on the kitchen floor, unable to speak coherently. The ambulance was called, but the mother had never granted power of attorney to anyone. The daughter couldn’t prove her mom wanted to go to the hospital, so she was forced to call a cab.

The daughter couldn’t prove her mom wanted to go to the hospital, so she was forced to call a cab.

Inaction in authorizing people to represent us can have serious financial repercussions as well. A man recently told me how his wife, aged 52 and 10 years his junior, had suffered a serious coronary attack five weeks earlier and was in a coma. Her workplace benefits package entitled her to apply for disability coverage, but the insurer was balking at processing an application from a spouse who couldn’t prove he had the right to speak for her. The couple had never considered the possibility that she might be the one to become incapacitated. No power of attorney had been designated.

In another case, a Cambridge, Ont., couple was selling their home when the husband became incapacitated due to an aneurysm. Both names were on the deed, so the husband’s signature was required to complete the transaction. They had never given each other power of attorney, so she was unable to complete the sale quickly. When the deal closed, half of the sale proceeds were sent to the Ontario Office of the Public Guardian and Trustee, to be held in trust for her husband. She had to apply to the courts for official guardianship of her husband, a process that took several months.

It is wise to set in place instructions about who should be in charge if you can’t be.

Ask your area Mennonite Foundation of Canada consultant for a free Estate Planning Guide or for guidance in your decision-making.

Mike Strathdee, CFP is a stewardship consultant with Mennonite Foundation of Canada’s Kitchener, Ont., office. For stewardship education, estate and charitable gift planning, contact your nearest MFC office or visit mennofoundation.ca.