Important conversations now can protect families financially for the future

TORONTO , Jan. 14, 2025 /CNW/ - Amid a currently challenging economy, Canadians may be feeling some uncertainty about the future. While many are clear that they want to financially protect their families after they're gone, they also admit they aren't actively planning to achieve these goals, according to a recent survey by RBC Insurance.

The majority (82%) of Canadians feel it is important to ensure their family receives money quickly to avoid paying out-of-pocket for a funeral or other end-of-life expenses. As many as 76 per cent want to ensure their estate is taxed as little as possible to leave their family a larger inheritance, and 70 per cent want to pass money to their family.

However, just 15 per cent of Canadians have a plan for how their money and belongings will be transferred to loved ones after they're gone, which only increases to 24 per cent for current retirees. Meanwhile, less than four in ten (38%) retirees have set aside money or have life insurance to pay for final expenses. Retirees are also the least likely to be knowledgeable about various types of insurance policies, overlooking the potential that could help achieve their goals.

"We often hear people say, 'I had no idea how hard it would be'," says Selene Soo, director, Product Management at RBC Insurance, referring to the process of managing a loved one's assets after they have died. "This is followed quickly by: 'If I had known, I would have helped to prepare their finances differently.' It's hard to hear because we know there are ways to make it easier."

Open conversations and working with professionals early to develop strategies based on your goals and unique situation can alleviate stress for you and your family later.

Relieve the admin burden for your loved ones.
While over half (53%) of Canadians confess they don't want to be a burden on their families when they're gone, many are surprised by the administrative and financial weight of managing a loved one's estate. Talking with your family and experts in advance can help them navigate complex paperwork, such as closing off bank accounts, paying debts, filing a last income tax return and maintaining property or other assets until they can be sold.

Ensure money is available as soon as your family needs it.
If not properly planned for, end-of-life costs may leave your family paying out-of-pocket. While money may be available, it is often tied up in probate – a legal process that can take several months or more than a year, while a court decides what happens to your financial assets and debts after you're gone and who is authorized to act on your behalf. Insurance products like life insurance and segregated funds automatically bypass probate if you name a beneficiary. This means your loved ones will receive any inheritance quickly, so they can be ready for financial surprises that may come their way. It also means you can minimize potential probate-related fees, making sure more money gets to your loved ones.

Stay in control of who receives your money.
Help your family avoid uncertainty and waiting periods by naming beneficiaries – the people who will receive the benefits of your policy or account when you die. This is especially helpful if you have complex family dynamics, own a business or if there is no written will. Identified beneficiaries receive money quickly and directly, avoiding the risk of needing to pay off debts first.

Regardless of your age or wealth, creating a plan with the help of loved ones and professionals will ensure that your finances are properly structured to achieve your legacy goals. As you consider your unique needs, talk to an advisor to simplify the experience and help your family when you're gone. For more information, visit What Is Estate Planning? | RBC Insurance.

About the RBC Insurance Survey
These are some of the findings from an Ipsos poll conducted on behalf of RBC Insurance. For this survey, a sample of 1,250 Canadians aged 18+ was surveyed between July 26 to 29, 2024. Included within this sample is an oversample of 250 Canadians aged 45-75 years old with a reported household income of $150k+. The precision of online polls is measured using credibility interval. In this case, the results are accurate to within ± 3.4 percentage points, 19 times out of 20, of what the results would have been had the entire population of Canadians 18+ been surveyed. Credibility intervals will be wider for smaller subsets of the population.

About RBC Insurance
RBC Insurance ^® offers a wide range of life, health, home, auto, travel, wealth, group benefits, annuities and reinsurance advice and solutions, as well as creditor and business insurance services to individual, business and group clients. RBC Insurance is the brand name for the insurance operating entities of Royal Bank of Canada, Canada's biggest bank and one of the largest in the world, based on market capitalization. RBC Insurance is among the largest Canadian bank-owned insurance organizations, with 2,600 employees who serve 4.8 million clients globally.

Media contact:
Jana Lepp , RBC Insurance Corporate Communications

SOURCE RBC Insurance