Beneficiary designations in Ontario
A beneficiary designation on a policy or a registered account decides where that money goes, and it usually overrides what the will says. It is the most common thing to be out of date on an otherwise careful plan, and nobody finds out until it is too late to change.
Found first, then checked against what you meant
- Every designation, foundPolicies, RRSPs, TFSAs, workplace plans and pensions, with the name currently on each one written down. This step alone surprises most people.
- Checked against the intentionWhether those names still match what you want, after any marriage, separation, birth or death since they were set. A designation from a previous decade is still a live instruction.
- Ordered, including contingentsWho receives it if the first named person does not survive you. A missing contingent is how money falls back into an estate and picks up cost and delay it did not need.
- Trusts, where they belongWhere money should not pass outright, because of age or circumstance, the structure is a legal question worked through with your lawyer. The planning side is knowing where that applies.
Who needs a designation review
- Anyone who has married, separated or had children since setting a designation
- Blended families, where the default outcome is rarely the intended one
- Parents of a minor or a dependent adult child
- People with old workplace plans from previous employers
About designations, and what a will can and cannot change
Does my will override a beneficiary designation?
Generally not. A valid designation on a policy or registered account directs that asset regardless of what the will says, which is why the two have to be looked at together rather than separately.
Does my common-law partner inherit automatically?
In Ontario a common-law partner does not automatically inherit, however long you lived together. Married spouses take the first $350,000 of the estate. A designation or a will is how that changes.
How often should designations be reviewed?
Whenever life changes, and at least once every few years. It takes one meeting, and it is the correction that costs least to make and most to miss.
Ehsan Khandaker is a licensed financial and estate planner, CLU and CHS. He is not a lawyer and does not draft documents. This page is general information about Ontario rules, not guidance about your own situation, and a will is drawn up by a lawyer.
Bring the policies. The first job is finding out whose name is on them.