This article appears in the February 2023 issue of Investment Executive. Subscribe to the print edition, read the digital edition or read the articles online.
Where there’s a will, there’s an increasing chance it was created by an online, do-it-yourself wills service.
Some of Canada’s major financial institutions, including CIBC and Royal Bank of Canada (RBC), have partnered with online services that allow clients to create a simple will in less than half an hour for a fraction of the price charged by a human lawyer.
Willful, for example, which has partnered with CIBC, charges $99 to create a basic will. According to Canadian Lawyer’s most recent legal fees survey, the average fee for drafting a simple will for an individual is $624, while the average complex will costs $2,242. Financial institutions and advisors partnering with online wills services may offer the products to their clients at a discount.
RBC’s partnership with Epilogue Wills was inspired by a variety of factors, including the fact that more than half of Canadian adults still don’t have a will, said Leanne Kaufman, president and CEO of RBC Royal Trust: “Clearly, there’s a huge portion of the population that just isn’t being reached by traditional will-drafting methods.”
Younger Canadians — those aged 27 to 34 — are significantly more likely than older Canadians to be without a will. For that reason, Kaufman said, RBC predicted that younger Canadians would be the heaviest users of the online estate-planning technology. That hasn’t been the case, however, among RBC clients, Kaufman said: “A wide spread of Canadians, age-wise, are interested in using the digital service. That’s probably the biggest ‘aha’ for me.”
Purpose Advisor Solutions began partnering with Willful in 2021. CEO Jeff Gans believes the service could particularly benefit the “mass affluent” market — middle-class individuals and households earning more than $75,000 and with $100,000 to $1 million in investable assets. High-net-worth clients, he noted, typically have estates that are too complex for online services, and generally have a team of lawyers, accountants and other advisors providing bespoke estate-planning tools.
The online platforms weed out potential clients — such as clients with children from different marriages — whose estates require more specific legal advice.
The endorsement of online estate-planning services by major financial institutions is part of a broader acceptance of online and automated financial and legal planning. That spirit is reflected in the Law Society of Ontario’s Access to Innovation (A2I) pilot project, which aims to improve access to justice by providing innovative delivery of legal services through technology. In November 2022, the A2I advisory council approved Willful as its first participant.
Gans foresees only growth for this type of service, especially considering increasingly sophisticated artificial intelligence technologies, including chatbots such as ChatGPT. “I can see a situation where you can tell a chatbot to ‘write me an estate plan for this type of situation,’” he said.
These technologies provide “most of the solution for most of the people,” according to Gans. But humans, he noted, can still do things that robos cannot, such as help clients identify their values, address anxiety and help clients remain accountable to their goals and plans.
“To me,” Gans said, “it’s a hybrid of the human and the technology working together to make the human more valuable.”
Would some clients be better off with traditional legal advice? Perhaps, Kaufman said. “But if they’re not going to do that, we’d rather they have a will, regardless,” she said. “Even the estate-lawyer bar would have to admit it would be better if the 50% of the population without a will got one, even if it was a simple one.”
Preserving clients’ digital legacies
When your client dies, what will happen to their Facebook account? What about all those photos and memories on Instagram? Or their tweets and Tiktoks?
Two-thirds of Canadians say they care about what happens to sentimental digital possessions such as photos, videos and social media accounts. But almost half haven’t made any plans to preserve or pass on their digital assets, and only 5% have used the digital legacy tools provided by social media giants such as Alphabet Inc., Apple Inc. and Meta Platforms Inc. (owner of Facebook).
As a result, said Tracey Woo, vice-president, professional practice and tax with RBC Royal Trust, many Canadians are at risk of losing those assets, leaving their digital lives (and estates) in limbo and risking identity theft. She noted strict U.S. privacy laws often block Canadian executors from accessing a testator’s accounts without a court order in the state in which the technology originated.
In response, according to Woo, the Canadian branch of the Society of Trust and Estate Planners (a.k.a. STEP Canada) launched the Protect Your Digital Memories lobbying campaign, calling on governments and tech companies to do more to help users preserve their digital accounts and their content.
Financial advisors, she said, can help by encouraging clients to take advantage of the legacy tools provided by social media companies, and by making clients aware of the importance of creating a comprehensive estate plan for digital assets.
That means, beyond the platforms’ legacy tools, clients should also document their most valuable digital assets (along with usernames and passwords) and specify what they would like done with them after death.