Your Will can be a very important document to update when you have a drastic change in your financial situation. This lesson is being learned the hard way by the four kids of Frances Lloyd of BC. Shortly before her death Frances won the $3 million lottery and shared some of her winnings. According to court documents she had given two of her four children each at least $500,000 dollars of the lottery winnings.
Winning the lottery is a dream for most people and Frances shared some of her winnings with two of her kids. However, three points stand out in the current court case that can be lessons learned. 1) Frances had no Will. 2) She had a joint account with only one daughter named who did not want to share the contents of the joint account with her siblings. 3) There was a lack of any estate plan. These situations create a lot of uncertainty and lead to the inheritances being decided by the law and it clearly shows what happens when a person dies without a Will. In this case, it has caused the kids to go to court.
With Frances dying so soon after winning the lottery, and her not having a Will, it is not clear what she wanted to happen with the lottery winnings or any other assets. Some would assume that she would want the $3 million divided equally but we will never know her intentions. This shows the importance of having a Will because the Will provides direction as to the equitable or fair inheritance of the assets.
The second lesson within this case is the joint account. The one daughter who was named on her mother’s joint account did not distribute the remaining money to the other kids. In my experience most of the time when parents create a joint account with one of the kids, they usually do it to make it easier to transfer that money or wealth after death – generally speaking, the parents want it to go fairly and equally. When adding a kid to a bank account the inheritance doesn’t have to transfer through the Will or be held up for months through the probate process. But in some cases, you can have a greedy kid who doesn’t distribute the money or feels they are entitled to more, although they were supposed to have given the money to others. Adding a kid as a joint owner of any assets should be documented and identified transparently so that money goes to where it is intended.
The final lesson is the importance of having an estate plan (or, an up-to-date one). These estate plans should include a Will, Power of Attorney, and open conversations with family members about what your intentions are and who are in place for the executor and attorney. Without a Will, there is no one in charge of the division of assets which creates uncertainty. This uncertainty paired with inconsistency can lead to fighting and a legacy of irreparable harm to family relationships.
There is a rise in Will variations disputes and estate litigation in BC, and this is an excellent example. While not everybody is going to win the lottery there are elements here that can be a great lesson you can apply to your life. There is an urban myth that parents believe having or adding kids to bank accounts (or houses) as joint owners is a good thing because they want to avoid the probate process, or they believe that the government is going to take all their assets. This is not the case, while joint ownership has its place, it really needs to be done based on the context of a person’s life.
The court case regarding Frances’s assets is a great learning lesson. It shows the importance of having a Will so it can avoid some messy aftermath. It is also important to update your Will, so any new events won’t cause tough situations for loved ones after you die.
We have created a checklist below on reasons when you should update your Will:
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