personal financial planning

Personal Financial Planning Assignment #4 – Due Wedn Nov 25th @ noon.

2 Questions – 5 marks each. Be as concise as possible using examples where possible while limiting your answer to 1 page per question so 2 pages for whole assignment.

Question#1.

Uncle George, a widower and your favorite relative tells you he has a Will and thinks everything should be fine so does not see the need for a Power of Attorney (POA) document. explain to Uncle George:

· Why he needs a POA; (think about health, housing & finances)

· What the POA can and cannot do;

· What criteria he should consider in choosing who to nominate as his POA.

Question #2.

Below is a recent CBC story from British Columbia involving a Will, beneficiaries and the SPCA. After reading the document about Estate Planning . discuss:

· What has caused the problem here;

· What recommendation would you give to Uncle George when he is preparing his Will so that something similar would not happen;

· How do you think the judge should rule? (This is opinion – there is no right or wrong – provide explanation for your answer that you would give to family and to SPCA).

Karin Larsen  · CBC News · Posted: Nov 16, 2020 5:56 PM PT | Last Updated: November 17

A B.C. family is contesting the amount of money granted to the SPCA in their deceased aunt's estate settlement. (David Horemans/CBC)

A Vancouver family is headed to court to contest almost $1.5 million the SPCA stands to gain in the estate settlement of a deceased relative. According to Gina Hancock, her great aunt Eleena Murray's will written in 2003 granted the B.C. SPCA the residue of her estate, putting it in line to receive $1.46 million, or about 80 per cent of the $2 million estate.

However, Hancock says Murray composed a handwritten note on her 99th birthday in May 2017 limiting the amount the animal protection agency would receive to $100,000. Murray died five months later without changing her will.  

"She intended something to go to the SPCA," said Hancock. "But not to the tune of $1.5 million." The residue of estate is money left over after assets of the deceased are liquidated, and all the expenses and distributions paid out.

Value of home affected amount left to SPCA. In Murray's case, the residue of estate skyrocketed during the years preceding her death in lock step with the value of her house in Vancouver's Point Grey neighbourhood, while the amount earmarked for relatives in inheritances remained static.   

Hancock believes her great aunt never wanted the SPCA to receive more money than family members and says the charity is being "greedy" by fighting her final requests.

In a statement, the B.C. SPCA said the courts are in the best position to rule on the handwritten note and what it calls a  "challenging situation" for all parties.

"There are several relatives who allege that a short handwritten note — unsigned, undated and not witnessed — with a number of names and amounts, represents Mrs. Murray's final testamentary wishes. They rely on that note and a meeting Mrs. Murray had with two friends who came to celebrate her 99th birthday in May of 2017, a time when there were issues with Mrs. Murray's mental capacity," said the statement. 

According to the SPCA, Murray bequeathed $440,000 to various relatives. Estate planning lawyer Sukhminder Virk said he generally advises clients to leave a fixed amount to charities to avoid conflict when it comes time to settle an estate. 

"Leaving any party the residue estate gives them a lot more leverage over the rest of the estate," he said. "It makes it easier to deal with a charity ... if you cut a cheque, as opposed to leaving a certain percentage. "Hancock says there were two witnesses to Murray writing the note on her 99th birthday and both have signed affidavits attesting to its veracity. 

A trial date is set for Jan. 25, 2021.