Today’s post is inspired by CTV’s article on the topic.
With rising household debt, clients often wonder what will happen with their parents’ debt. Importantly, if a person doesn’t take proper measures to keep assets safe from creditors, their debts are typically paid out of their estate before any inheritance is distributed to beneficiaries.
The process of settling a person’s estate involves using their assets to pay off any outstanding debts, such as loans, credit card balances, and other liabilities. If there are not enough assets to cover the debts, the remaining debt typically does not pass on to the deceased person’s beneficiaries or family members. This can be a shocking revelation to beneficiaries who were expecting an inheritance.
Consulting with your Estates Lawyer can help you protect family assets, guide you through the estate planning process and help you understand your rights and responsibilities.