Estate Obligations

KNOWLEDGE EXPECTED OF: CFP® Professionals

Highest Knowledge Level: Understanding

Knowledge Levels and Associated Verbs


Awareness
The state of being aware that something exists / to have familiarity with a particular activity or subject
Understanding
To comprehend the general relationship of particulars / to have an expertise with how something works
Application
Ability to put information to use / to use knowledge for relevant, practical purposes
Evaluation
To judge or conclude by utilizing data / a systematic determination of something’s worth or significance
Define
To state exactly the meaning of
Identify
To be aware of / to recognize and correctly name / to locate an appropriate resource
Explain
To make clear the meaning of / to describe something in more detail or reveal relevant facts or ideas related to it
Determine
To ascertain / to come to a decision, such as by investigation or reasoning
Compare
To note the similarities and differences between two or more things
Estimate
To determine an approximate value for
Calculate
To find the value using mathematics
Convert
To change from one form or purpose to another
Evaluate
To reach a conclusion or make a through careful study
Interpret
To give the meaning of / to construe or understand / to translate orally

Hold cursor over or click on each term to read its definition.


Additional Knowledge Expected of CFP Professionals
  • Identify those obligations that may retain the highest priority of payment from an estate, such as:
    • Funeral expenses
    • Income taxes
    • Estate taxes / probate fees
    • Solicitor’s costs
    • Personal representative / estate administrator costs
    • Payments of debts
    • Property taxes
    • Utility payments
  • Identify that the order of priority for payments from an estate may vary according to provincial/territorial legislation.  
  • Explain methods for creditor-proofing assets from claims against the estate, such as:
    • Naming beneficiaries on segregated funds, insurance policies and registered assets
    • Using insurance products with named beneficiaries
    • Setting up a holding company or inter vivos trust
    • Plan for a testamentary trust in a will
    • Setting up an Individual Pension Plan
    • Incorporation of business interests
  • Explain the probate process for administering an estate.
    • When the deceased died with a valid will
    • When the deceased died without a valid will (intestacy)
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