Passing Down Your Wealth: The Biggest Inter-Generational Wealth Transfer Happening Right Now

Passing Down Your Wealth: The Biggest Inter-Generational Wealth Transfer Happening Right Now

If you’re thinking about passing wealth to your children or loved ones now or in the future, you’re not alone. Over the next couple of decades, Canadians are expected to transfer more than $1 trillion in wealth from Baby Boomers to their Gen X and Millennial children between 2023 to 2026, driven largely by assets such as their home values and other investments. But handing off your legacy isn’t just about money, it’s about making sure your values, intentions, and wishes are clearly understood.

Here are a few key speaking points to keep in mind as you plan.

1. Start the Conversation Early

The most important part of wealth transfer? Talking about it.

Many families avoid discussing money — sometimes out of fear it’ll create tension, or because it’s just uncomfortable. But open conversations help avoid surprises down the road. Whether it’s sharing why you’re gifting money early, or how you hope your estate will be divided, communication can help bring clarity and reduce family conflict later.

You don’t have to go into every detail, but giving your loved ones a general understanding of your wishes goes a long way.

2. Know the Tax Basics in Canada

Here’s some good news… Canada has no gift tax. You can give money or assets to your loved ones during your lifetime without triggering a gift tax. But that doesn’t mean it’s tax-free in every case.

• If you gift cash, there are no tax implications for you or the recipient.
• If you gift investments or property, you may trigger capital gains tax as if you sold the asset at fair market value.
• If you’re planning to gift a cottage or rental property, special care is needed to plan around the potential tax bill.

Also, when you pass away, certain assets (like RRSPs, non-registered accounts, or property) may trigger taxes unless planned for properly. Insurance or strategic gifting can help offset this

3. Use Accounts That Avoid Probate

In Canada, probate is the legal process of settling your estate, and it often comes with fees and delays. You can reduce probate exposure by:

• Naming beneficiaries on RRSPs, RRIFs, and TFSAs
• Considering joint ownership (with right of survivorship) for certain assets — like a bank account or family property — if it makes sense for your situation
• Using life insurance to pass on a tax-free benefit directly to your beneficiaries

4. Gifting While You’re Alive

Many clients ask us: Should I give now or later?

Giving during your lifetime can be deeply rewarding. You get to see your kids or grandkids benefit — whether it’s helping with a down payment, education, or business. Just make sure the gift fits within your own financial plan.

We can help you run the numbers to make sure gifting won’t impact your retirement or future needs.

5. Get the Right Team Around You

Every family and financial picture is different. That’s why working with your financial planner, accountant, and estate lawyer is so important. We’ll help make sure your strategy is tax-smart, legally sound, and reflects your intentions — not just today, but for years to come.

Final Thoughts

Whether you’re planning to give a little now or leave a legacy later, the best gift you can give your family is a plan. One that reduces stress, minimizes taxes, and keeps your family aligned. If you’re thinking about how to structure a gift or update your estate plan, let’s talk. We’re here to help make the process simple, thoughtful, and uniquely yours.


Disclaimer:
This content is for informational purposes only and should not be considered legal or tax advice. While we help clients navigate the financial aspects of gifting strategies, we do not provide legal or tax services. We recommend working with a qualified legal or tax professional to assess how any gifting strategy aligns with your personal circumstances. We’re happy to collaborate with your external advisors to ensure all aspects of your plan are carefully considered.