Before my own parents died, I managed their investments and taxes for about 10 years. Here are some things we had set up that made things much easier as they relied more and more on me in their final years. In my case, they placed their trust in me while of sound mind and body. Things probably look a lot different if this isn’t the case for you. And once again, I will remind you that I’m not a lawyer.

Make sure they have a will, you know who prepared it, and you know where it is

I cannot imagine how much more complex managing my parents’ estate would have been had there not been a will. They made a habit of reminding me where theirs was kept periodically. This was a tremendous relief after they died. In Ontario, the rules of probate dictate that a will has to have an “Affadavit of Execution” in order to be considered a valid document. What this means practically is that the legal team who prepared the will in the first place has to certify that yes, they did indeed prepare the will and the signatures on the will are the ones they remembered. So, as executor, this meant I had to march the signed will over to the law firm who prepared it, and they had to call the lawyer who signed it out of retirement to come in to the office to fill out the Affadavit. (If this sounds crazy to you, I can assure you, you’re not alone…)

Have a Power of attorney (PoA) set up

Having your parents’ logins (which I know is a very common practice) is NOT the same thing as the steps I’m outlining here. While you may be able to do quite a bit this way, having a PoA is much better. The PoA I’m referring to is the “Continuing Power of Attorney for Property” as mentioned by the feds. (There’s another, separate, PoA for health decisions, but that’s not what I’m talking about here). PoA is only applicable to living people — the PoA document doesn’t have any authority once the person is dead, that’s what the will is for. The PoA document is a necessary but rarely sufficient document to get a bank or broker to talk to you on behalf of your parents. Every financial institution I dealt with insisted that I fill out their own forms in addition to providing a PoA to get the ball rolling. Many lawyers prepare PoA documents as part of their will package, but for my parents, we just used the free form on the Government of Ontario website¹. With this form I was able to get my own “authorized attorney” login for my parents’ RRIF/TFSA/investment accounts at BMO Investorline.

Set Up an Authorized Representative with CRA

An “authorized representative” is someone designated by the parent as being able to communicate on their behalf with the Canada Revenue Agency. It’s a common practice if you happen to hire a tax pro to prepare your taxes. I was my parents’ authorized rep; it’s surprisingly easy to set up by following the instructions over at https://www.canada.ca/en/revenue-agency/services/tax/representative-authorization/overview.html.

Simplify, simplify, simplify

Any extra bank account, any extra RRIF/TFSA/RRSP/Investment account creates more work and more headaches to the eventual executor of the estate, ESPECIALLY if it involves multiple financial institutions. Do those you leave behind a big favour and ruthlessly eliminate any extras.

A joint bank account between a child and a parent can be very useful

Here you have to be quite careful, lest you inadvertently create a “bare trust” under CRA rules. Here I’m talking about enough money to deal with post-death expenses — last utility bills, funeral expenses…This is helpful since (as stated above) a PoA no longer has any validity once the person who signed it is dead. My parents added me to their joint chequing account many years ago…since this account was quite modest in terms of its holdings (it was really only for day to day expenses) I never had to worry that they had set up a bare trust.

1. If anyone reading this has any sort of influence on documents posted by the Government of Ontario on their websites, could you please let them know that requiring the use of Adobe Acrobat to open and edit pdfs goes against all notions of equal access to their constituents? My poor little Chromebook doesn’t do Acrobat. ↩︎