The downtown core of Toronto is swollen and engorged with an especially large number of global LGBTTIQQ2Ss in town for a mighty party. Along with the traditional pride celebrations, Toronto is hosting World Pride 2014 and so this year's party is particularly well-endowed with events.
Trying to make some space on the scene is BMO with a serious report, Taking the Rights and Opportunities You Have Now More Seriously, about finances and estate law. Released Thursday, just as the party really gets going, it will be ignored.
Be sure, no on is talking about personal finance in a week that will feature, among other things, a human rights conference, AIDs vigil, trans parade, dyke march, gala and awards ceremony, jazz brunch, community cabaret, family events, Carly Rae Jepson, photo exhibits, improvisational dance, a yogic celebration of the summer solstice, salsa concerts, spoke word events, academic lectures, retrospectives, gay Russian dissidents, several on-street stages, flag raising ceremony with newly elected gas premier Kathleen Wynne, home-based parties, tribute to house music legend Frankie Knuckles, conference on intergenerational LGBTQ connectiveness for seniors, art crawl, community fair, drag musicals, the Toronto Mens' Chorus, indigenous art event, nudist social, gay porn stars, the hottest Los Angeles sound crews, youth events, sporting events, a joyous Shabbat service and potluck, a habitat for humanity build, a formal high tea at the King Edward and, of course, an El-Tawhid Juma Circle at the Toronto Unity Mosque.
So, yeah, no one is talking about personal finance, insurance, wills or estate law. Download the report, put it away for later. This is the stuff LGBTQ couples need to think about when the party is done.
"It's not a matter of standing out." said Chris Buttigieg, senior manager, wealth planning strategy, BMO Financial Group. "As a nation Canada is leading the world in terms of diversity and inclusiveness. As a bank it is important for us to help all, What we want to do is provide every Canada a financial future."
According to BMO, the LGBTQ community is well on its way toward acceptance and equality. But now that the law allows same-sex couples to enjoy the same rights as straights, it's time for LGBTQ couples to set the financial and legal house in order.
Changes in Old Age Security and the Canada Pension Plan in 2000 allow the benefits and obligations of these income support programs to be extended to same-sex and common-law couples. These changes include the availability of survivor benefits for common-law partners of deceased individuals. As long as both partners are over the age of 60 and receiving CPP payments it is possible to share a portion of CPP benefits (proportional to time spent together).
For Canadian tax purposes the ability to save and defer taxes as part of both a financial plan became available to same-sex couples in 2001. Income splitting strategies such as the use of spousal RRSPs, prescribed-rate loans between spouses, pension income splitting, and the transfer of certain tax credits between spouses, are all now possible.
But most important for same-sex couples is getting the will written correctly. A person who dies without a will in place is considered to be "intestate." According to the report, "Unfortunately, intestacy rules in several provinces do not provide for same-sex partners, or for common-law partners in general. Instead, assets go to the closest blood relationships - such as parents, children or siblings. In these cases a common-law partner will have to fight using other provincial legislation for a share of assets or for financial support. This can be difficult if family members of the deceased partner did not support the same-sex relationship. Having a properly worded will can help to provide financial protection in the case of a surviving same-sex or common-law spouse."
"Each province can have different ways of answering the question of whether a common-law partner is a spouse," Buttigieg Some provinces consider the time spent together. Other provinces require definitions based in dependence law. These are differences that need to be understood. Interestingly, the western provinces are more liberal when it comes to the likelihood a couple would be considered spousal. "The eastern province less so," says Buttigieg.
It is also important that wills are drafted so that power of attorney to protect both spouses is set up. This will allow a trusted partner to take care of a partner's finances as well as health-care decisions."This is where it becomes really important. Family acceptance is important. Make sure it's in written Have that conversation with family. Have assets jointly owned," says Buttigieg.
Life insurance should be updated to ensure same-sex partners are named as beneficiaries Also important is having documentation available when travelling. If a gay couple is traveling in a less-accepting part of the world, especially with kids, it helps to have some official documents. As well, while many Fortune 500 companies claim equality as a principle, only 62% offer benefits to same-sex spouse. "Know what is in the benefits plan," says Buttigieg.
Some interesting details from the report: In 2011 there were approximately 65,000 same sex couples in Canada. This is about one per cent of all couples and double the number of same-sex couples reported 10 years ago. Same-sex couples tend to live in the largest cities in Canada, almost half (45.6 per cent) live in Toronto, Montreal and Vancouver. In contrast, only one-third of opposite-sex couples live in these cities. Members of the community often earn higher incomes. One-third of the Canadians in this community earned more than C$100,000 a year ($92,050). Overall the community's spending power in Canada is now C$100 billion.
Now that legal status has been extended to LGBTQ coupled, it is up to each couple to take advantage of the guarantees by doing the paper work. In an era when each person now has the power to define their own life, as they see fit, it is important to take advantage of the freedom.
Now, if someone can just explain why it is feminist art performance/heavy metal tribute band, Vag Halen
, is not performing this year, the party can start.
The full report is here: www.bmo.com/wealthinstitute