Just 41 per cent of Canadians have had discussions with loved ones about their end-of-life wishes and only half of those who are married have discussed their own wishes and know their spouse’s or family’s wishes. (Credit: PNG Merlin Archive)
Canadians are in the midst of a $1-trillion wealth transfer between generations, but most still aren’t prepared for it.
A bit more than half of Canadians have a will, but that number shrinks to 10 per cent of gen-Zers and 29 per cent of millennials, according to a new report by Willful.
“The assumption that planning is only for ‘later in life’ is leaving younger generations exposed, even as they juggle mortgages, children, and debt without safeguards in place,” the report said.
Just 41 per cent of Canadians have had discussions with loved ones about their end-of-life wishes and only half of those who are married have discussed their own wishes and know their spouse’s or family’s wishes.
Overall, 24 per cent don’t have any documentation regarding their end-of-life wishes.
The “great wealth transfer” refers to the money being passed down to younger generations from the baby boomer generation. Estimates show it could be worth between $1 trillion and $2 trillion within the next 10 to 20 years.
Many younger Canadians may be expecting a sizable payday from this inheritance, but it might be worth tempering expectations.
For one thing, there are sizable tax considerations that may reduce the size of the inheritance, while the rising cost of living may deplete the savings that older Canadians have amassed, thus reducing the amount that may be passed down, according to a report by Vanguard Canada.
The lack of preparedness has leaked over to financial advisers as well, with 46 per cent of Canadians saying their adviser has never discussed end-of-life planning with them.
“This increases to 65 per cent for gen Z, leaving many younger clients underadvised and signalling a mismatch between client expectations and the support being provided,” the report said.
Some are noticing this lack of preparedness among investors, with 40 per cent of advisers saying they lost assets after a death because the client decided to switch firms.
“The research underscores a clear need for change: Canadians are underprepared, families are leaving conversations unfinished, and advisers face real retention risks without stronger intergenerational engagement,” the report said.
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Last week’s mega deal between Anglo American PLC and Teck Resources Ltd. sent shockwaves through the mining industry.
Anglo’s acquisition of Teck, valued at about US$60 billion, would create one of the world’s largest mining companies, though it still requires regulatory approval from several countries, including Canada.
The move caught many peers flatfooted with some of the biggest firms wondering how much room there is to grow when it comes to mergers and acquisitions.
Today’s data: Wholesale trade for July, existing home sale and MLS home price index for August, now motor vehicle sales for July
Today’s earnings: Dave & Buster’s Entertainment Inc., Toro Corp.
Canadians starting a side business as a means of writing off some personal expenses as business expenses need to be careful, as losses may be denied if the business isn’t run in a sufficiently commercial way. Recently, a taxpayer was denied 2019 and 2020 business losses on an Amway business, but the amount of work the taxpayer described should have drummed more sales than they claimed, leading a judge to believe that some or most of the expenses were for personal use. Read more here.
Are you worried about having enough for retirement? Do you need to adjust your portfolio? Are you starting out or making a change and wondering how to build wealth? Are you trying to make ends meet? Drop us a line at wealth@postmedia.com with your contact info and the gist of your problem and we’ll find some experts to help you out while writing a Family Finance story about it (we’ll keep your name out of it, of course).
Want to learn more about mortgages? Mortgage strategist Robert McLister’s Financial Post column can help navigate the complex sector, from the latest trends to financing opportunities you won’t want to miss. Plus, check out his mortgage rate page for Canada’s lowest national mortgage rates, updated daily.
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Today’s Posthaste was written by Ben Cousins with additional reporting from Financial Post staff, Canadian Press and Bloomberg.
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