Wills
KNOWLEDGE EXPECTED OF: QAFP® 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
|
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|---|---|---|---|---|---|---|---|---|---|
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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.
- Define a will.1
- Identify the purpose for which a will may be used.
- Identify that a will may only be valid in the jurisdiction in which it is created.
- Identify that the creation of a new will may revoke a past will, unless explicitly stated otherwise in the new document.
- Identify types of wills.
- Formal
- Notarial
- Holograph
- Identify requirements for each type of will, such as:
- Need for document to be written
- Need for signature of testator
- Witness requirements
- Explain the importance of maintaining an up-to-date, valid will.
- Explain risks associated with failing to have a current will.
- Identify advantages and risks of the following approaches to drafting a will.
- Self-drafting
- Drafting by a competent legal professional
- Define parties to a will.
- Testator / Testatrix
- Personal representative 2
- Witness
- Guardian
- Beneficiary
- Define testamentary capacity.
- Identify the importance of testamentary capacity.
- Identify what the testator must understand in order to have testamentary capacity.
- The nature of the act of making a will (or testamentary document) and its effects
- The extent of the property which they are disposing
- The claims of persons who would normally expect to benefit under the will (testamentary document)
- Identify the minimum age for creating a will.
- When the testator is the age of majority
- When the testator is married and younger than the age of majority
- When the testator has a child and is younger than the age of majority
- When a testator is a member of the military
- Define a personal representative.3
- Explain the importance of naming a personal representative(s).
- Identify titles used for personal representatives, such as:
- Executor
- Executrix
- Estate trustee
- Liquidator
- Identify who may be a personal representative.
- Explain qualities that a personal representative should possess, such as:
- Trustworthiness
- Availability
- Reliability
- Willingness
- Explain factors to consider when contemplating the appointment of a personal representative, such as:
- Location of estate and beneficiaries
- Complexity of estate
- Time required to manage estate
- Expertise
- Need for objectivity or opportunity for disputes regarding estate
- Explain the impact of naming multiple personal representatives (co-representatives).
- Benefits
- Risks
- Identify how many personal representatives must agree on a decision.
- When a designation within the will states that they may act jointly and severally
- Where no designation within the will has been made
- Explain the importance of naming an alternate personal representative(s).
- Identify duties of a personal representative, such as:
- Locate the will and obtain a death certificate
- Locate all the assets of the deceased and determine their value
- Secure and protect assets
- Pay funeral expenses
- Obtain probate, if required
- Notify the appropriate organizations of the testator’s death
- File claims for life insurance, pension plan and death benefits
- Notify appropriate government organization if deceased leaves dependent children or adults
- Advertise for creditors
- Collect and liquidate estate, if required
- Pay the bills of the deceased and the estate
- File the income tax returns for the deceased and the estate and obtain a clearance certificate from Canada Revenue Agency
- Provide an accounting to any of the beneficiaries, if required
- Distribute the estate according to the will or intestacy legislation
- Identify advantages and disadvantages of using a corporate personal representative.
- Identify factors to consider when contemplating the appointment of a corporate personal representative, such as:
- Location of trust and beneficiaries
- Complexity of estate
- Time required to manage estate
- Expertise
- Need for objectivity or opportunity for disputes regarding estate
- Identify that a personal representative is entitled to a fee for administering an estate, subject to guidelines set out in legislation in the province where the estate resides.
- Identify individuals who are generally prohibited from acting as a witness to a will.
- Spouse
- Child
- Parent
- Individual named as a beneficiary in the will
- Explain the importance of identifying a guardian for dependents.
- Results from failure to identify a guardian for dependents
- Results from failing to inform guardians of their potential appointment
- Identify circumstances that may cause a will to be partially or fully revoked,4 such as:
- Voluntarily revoked by testator
- Drafting a new will
- Destruction of a will
- Marriage
- Divorce
- Identify life events that may precipitate a will review, such as:
- Birth or adoption of a child
- Marriage
- Entering a marriage or common-law relationship
- Separation from a spouse or common-law partner
- Divorce
- Death of a family member
- Death of a beneficiary
- Change of residence
- Starting a business
- Changing ownership structure of a business
- Change in financial position (e.g., inheritance)
- Change in personal circumstances of a personal representative or trustee
REFERENCES
1 A will is the most common form of testamentary document. Testamentary documents, written during the life of a testator, provide for the disposition of the testator's property upon the testator's death. A codicil to a will is another form of testamentary document.
2 Personal representative refers to the individual or entity whom the testator has chosen to administer their estate. They may also be known in different jurisdictions by titles such as executor/executrix. Unless otherwise noted, in this document “personal representative” refers to the individual or entity who holds any of these titles.
3 Personal representative refers to the individual or entity whom the testator has chosen to administer their estate. They may also be known in different jurisdictions by titles such as executor/executrix. Unless otherwise noted, in this document personal representative may refer to the individual or entity who may hold any of these titles.
4 The revocation of a will due to marriage or divorce differs greatly across jurisdictions. Many jurisdictions are investigating and drafting new legislation related to this topic. Financial planners are encouraged to verify such information for the jurisdiction in which they practice, as changes are occurring frequently.
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.
- Define a will.1
- Identify the purpose for which a will may be used.
- Identify that a will may only be valid in the jurisdiction in which it is created.
- Identify that the creation of a new will may revoke a past will, unless explicitly stated otherwise in the new document.
- Identify types of wills.
- Formal
- Notarial
- Holograph
- Explain the importance of maintaining an up-to-date, valid will.
- Explain risks associated with failing to have a current will.
- Define parties to a will.
- Testator / Testatrix
- Personal representative 2
- Witness
- Guardian
- Beneficiary
- Define testamentary capacity.
- Identify the minimum age for creating a will.
- When the testator is the age of majority
- When the testator is married and younger than the age of majority
- When the testator has a child and is younger than the age of majority
- When a testator is a member of the military
- Define a personal representative.3
- Explain the importance of naming a personal representative(s).
- Identify titles used for personal representatives, such as:
- Executor
- Executrix
- Estate trustee
- Liquidator
- Identify who may be a personal representative.
- Explain qualities that a personal representative should possess, such as:
- Trustworthiness
- Availability
- Reliability
- Willingness
- Explain factors to consider when contemplating the appointment of a personal representative, such as:
- Location of estate and beneficiaries
- Complexity of estate
- Time required to manage estate
- Expertise
- Need for objectivity or opportunity for disputes regarding estate
- Explain the impact of naming multiple personal representatives (co-representatives).
- Benefits
- Risks
- Explain the importance of naming an alternate personal representative(s).
- Identify duties of a personal representative, such as:
- Locate the will and obtain a death certificate
- Locate all the assets of the deceased and determine their value
- Secure and protect assets
- Pay funeral expenses
- Obtain probate, if required
- Notify the appropriate organizations of the testator’s death
- File claims for life insurance, pension plan and death benefits
- Notify appropriate government organization if deceased leaves dependent children or adults
- Advertise for creditors
- Collect and liquidate estate, if required
- Pay the bills of the deceased and the estate
- File the income tax returns for the deceased and the estate and obtain a clearance certificate from Canada Revenue Agency
- Provide an accounting to any of the beneficiaries, if required
- Distribute the estate according to the will or intestacy legislation
- Identify that a personal representative is entitled to a fee for administering an estate, subject to guidelines set out in legislation in the province where the estate resides.
- Identify individuals who are generally prohibited from acting as a witness to a will.
- Spouse
- Child
- Parent
- Individual named as a beneficiary in the will
- Explain the importance of identifying a guardian for dependents.
- Results from failure to identify a guardian for dependents
- Results from failing to inform guardians of their potential appointment
- Identify circumstances that may cause a will to be partially or fully revoked,4 such as:
- Voluntarily revoked by testator
- Drafting a new will
- Destruction of a will
- Marriage
- Divorce
- Identify life events that may precipitate a will review, such as:
- Birth or adoption of a child
- Marriage
- Entering a marriage or common-law relationship
- Separation from a spouse or common-law partner
- Divorce
- Death of a family member
- Death of a beneficiary
- Change of residence
- Starting a business
- Changing ownership structure of a business
- Change in financial position (e.g., inheritance)
- Change in personal circumstances of a personal representative or trustee
Additional Knowledge Expected of CFP Professionals
- Explain requirements for each type of will, such as:
- Need for document to be written
- Need for signature of testator
- Witness requirements
- Explain advantages and risks of the following approaches to drafting a will.
- Self-drafting
- Drafting by a competent legal professional
- Explain the importance of testamentary capacity.
- Explain what the testator must understand in order to have testamentary capacity.
- The nature of the act of making a will (or testamentary document) and its effects
- The extent of the property which they are disposing
- The claims of persons who would normally expect to benefit under the will (testamentary document)
- Explain how many personal representatives must agree on a decision.
- When a designation within the will states that they may act jointly and severally
- Where no designation within the will has been made
- Identify the options that may be available when a personal representative is unavailable to act (voluntarily or due to incapacitation or death).
- Explain clauses in a will, such as:
- Identification of the testator
- Revocation of previous wills
- Appointment of personal representative
- Powers provided to personal representative
- Payment of debts
- Instructions for testamentary dispositions (beneficiaries, assets, timing of distribution to beneficiary)
- Common disaster / survivorship clause
- Instructions for testamentary appointments of guardianship for dependents (i.e., minor children)
- Terms of trust
- Appointment of trustees
- Powers provided to trustees
- Beneficiary designations
- Investment discretion clause
- Discretionary encroachment clause
- Life interest / capital interest clause
- Tax election clause
- Memorandum clause (for personal effects)
- Explain types of testamentary dispositions that may be included in a will, such as:
- Specific
- Demonstrative
- General
- Residual
- Explain advantages and disadvantages of using a corporate personal representative.
- Explain factors to consider when contemplating the appointment of a corporate personal representative, such as:
- Location of trust and beneficiaries
- Complexity of estate
- Time required to manage estate
- Expertise
- Need for objectivity or opportunity for disputes regarding estate
- Identify that in jurisdictions in which a marriage revokes a previous will, a will that contains a statement of contemplation of marriage to a specified person may not result in revocation of the will upon the marriage to that person.
- Identify the purpose for which a codicil may be used.
- Explain requirements for a codicil to be valid, such as:
- Need for document to be written
- Need for signature of testator
- Acceptable parties who may draft the document
- Witness requirements
- Requirement to refer to the will
REFERENCES
1 A will is the most common form of testamentary document. Testamentary documents, written during the life of a testator, provide for the disposition of the testator's property upon the testator's death. A codicil to a will is another form of testamentary document.
2 Personal representative refers to the individual or entity whom the testator has chosen to administer their estate. They may also be known in different jurisdictions by titles such as executor/executrix. Unless otherwise noted, in this document “personal representative” refers to the individual or entity who holds any of these titles.
3 Personal representative refers to the individual or entity whom the testator has chosen to administer their estate. They may also be known in different jurisdictions by titles such as executor/executrix. Unless otherwise noted, in this document personal representative may refer to the individual or entity who may hold any of these titles.
4 The revocation of a will due to marriage or divorce differs greatly across jurisdictions. Many jurisdictions are investigating and drafting new legislation related to this topic. Financial planners are encouraged to verify such information for the jurisdiction in which they practice, as changes are occurring frequently.
