Scotia Private Client Group expert offers advice to keep the family cottage a peaceful place

TORONTO, May 16 /CNW/ - Handing down the family cottage can be financially and emotionally challenging without a succession plan in place to deal with the questions and conflicts that often emerge.  As cottage season approaches, Scotia Private Client Group offers advice on how to avoid a difficult scenario for your family and your funds.

"The dream of inheriting a cottage can cause conflict among family members if there isn't a succession plan in place to divide or share the property," says Elaine Blades, Director for Estate and Trust Products & Services, Scotia Private Client Group. "Too often people simply put directions in their will about who should inherit the family cottage and assume things will work out, but sadly, that's not always the case."

Families face numerous issues when dealing with succession planning.  With geographical distances between them, socio-economical differences or complex family relationships, each family member has a different stake or interest in the family cottage. Dividing the cottage equally may seem fair, but it is not necessarily the best solution for all involved. For instance, one sibling may live out-of-province or overseas and therefore rarely use the cottage. There may be a new in-law who doesn't share the emotional stake and would be just as happy to sell. Or, all siblings may enjoy the benefits of the cottage but can't come to an agreement on who gets to use it when, who pays for what, and who is ultimately responsible for it.

Every stakeholder has his or her own view on what is best or right. To help avoid conflict, Ms. Blades recommends families meet to openly discuss everyone's interests, outline the ideal outcome and work backwards from there.

"When it comes to the cottage, family members are emotional stakeholders so it's important to plan for the 'soft' family issues and the 'hard' financial issues," adds Ms. Blades. "There are a myriad of scenarios and options to think about and an estate planner can help anticipate the issues and advise on how to help get you there. An expert's impartiality will also allow for the most practical and flexible solutions - as well as many more family memories to cherish."

Everyone has heard stories about family conflicts that can develop from inheriting a cottage.  The best way to avoid them is to plan ahead.

According to estate litigator, Justin de Vries, Principal of de VRIES LITIGATION, "Estate litigation is increasing exponentially, and disputes over the cottage can be one of the most volatile and destructive. If a cottage property dispute ends up in court, it usually results in a family torn apart, costs to the estate, costs to the parties, and the cottage sitting empty until the litigation is resolved. This is not the legacy parents want to leave behind. The best advice I can give is talk to your children.  Plan now and plan often to avoid family heartache in the future."

In order to avoid legal implications, Ms. Blades advises cottage owners to talk to their children now and develop a plan. It may be a difficult conversation to have but it is much easier to have a clear understanding of everyone's expectations in advance, and advance planning enables parents to consider the financial implications within their overall estate plan.

Other Financial Considerations for Cottage Succession Planning
While family dynamics are often the most important consideration when planning the future of the cottage, the unknowns and potential financial implications can also be daunting and are an important consideration as part of a family plan. Here are some topics to consider during planning:

  • Unexpected costs can be significant including probate fees, capital gains tax, and land transfer tax. Are these applicable?
  • Gifting now, bequeathing, or selling to the kids - what's the best course for all concerned?
  • What's the best legal structure? Joint title (joint tenancy or tenants in common), sole ownership, held in trust?
  • How can you treat the kids "fairly" when not all have an interest in and/or the ability to enjoy the cottage?  Fairly does not always translate into equally.
  • Insurance strategies - what are they and what role can they play?
  • Availability of principal residence exemption - how does this work and what are the tax implications?

Seeking out expert advice, exploring options and engaging family in the discussion can all help to ensure memories of the family cottage continue to be happy ones.

About Scotia Private Client Group:
Scotia Private Client Group provides customized solutions to help high net worth clients build, preserve and transfer their wealth.  Scotia Private Client Group consists of private client services from The Bank of Nova Scotia, The Bank of Nova Scotia Trust Company, Scotia Asset Management L.P., Scotia Asset Management U.S. Inc., ScotiaMcLeod Financial Services Inc., and ScotiaMcLeod®, a division of Scotia Capital Inc. Scotia Capital Inc. is a member of the Investment Industry Regulatory Organization of Canada and the Canadian Investor Protection Fund. Scotia Private Client Group is a registered business name of The Bank of Nova Scotia, The Bank of Nova Scotia Trust Company, ScotiaMcLeod Financial Services Inc., Scotia Asset Management L.P., and Scotia Capital Inc. in the jurisdictions in which they carry on business. Estate and succession planning services are provided by The Bank of Nova Scotia Trust Company.  For more information, please visit


For further information:

Tara Wood, Narrative Advocacy Media, (416) 644-4133,

Organization Profile


More on this organization

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890