28 Jan Why You Need to Consider Power of Attorney
Planning ahead can be uncomfortable, but is necessary to stop potential rifts and saving your loved ones heartache. Making decisions about Powers of Attorney is one of these important choices that should be made well in advance of any health concerns or big life changes.
A Power of Attorney is a legal document that gives a person or persons the right to make decisions on your behalf while you are alive. This can include a variety of practical decision making and protects you, your finances, and your property.
The person you choose as your Power of Attorney must be a mentally capable adult of legal age. They cannot work at an extended care facility or nursing home where you are a resident, and cannot be involved in any bankruptcy proceedings when you assign powers to them. With few other exceptions, anyone else is able to be assigned Power of Attorney.
In general, then, you can give Power of Attorney to a spouse, a family member, a professional, a trusted friend, or any other capable adult that you see fit.
When Should I Consider Assigning a Power of Attorney?
Powers of Attorney are often associated with medical conditions and wills, however, it can be beneficial in a variety of situations. These include, but are not limited to:
- You are going on an extended vacation in another country
- You have a medical condition which could impact your mental fitness
- Your job requires you to travel out of country for extended periods
- You own a business and are concerned about its operation in your absence
- You need to set specific instructions and limits on how your finances and property are handled if you are absent or incapacitated
- You want to ensure a specific person has control over your affairs
What Does Power of Attorney Include?
Powers of Attorney can be related to a Last Will and Testament, but it is important to note that they are not the same legal document. A Last Will and Testament only takes effect upon your death and covers the distribution of your property. A Power of Attorney applies when you are alive and ceases to be effective upon your death. Therefore, you should always create a will even if you have a Power of Attorney.
There is also the legal document known as the “advance directive”. This document is instruction of your treatment and personal care wishes in the event of serious illness. You can include an advance directive as part of your Power of Attorney documents so they are aware of them, but an advance directive alone does not need to name anyone specific to carry out your wishes.
In contrast, named attorneys are required by law to act on behalf of your best interests and makes decisions on your behalf completely separate from their own finances and decisions.
There are a few actions that your attorney is unable to do. They cannot create or alter your Last Will and Testament. They cannot create a new Power of Attorney on your behalf and assign the responsibility to someone else. And, they cannot make medical decisions for you (unless they are named as attorney for Personal Care – more information below).
There are two main types of Power of Attorney, one for property and one for personal care.
Continuing Power of Attorney for Property
This type of Power of Attorney permits another person to make decisions on your behalf with regards to property. This covers your financial affairs and allows the person you name to make decisions in regards to your property and finances even if you become mentally incapable, such as due to accident or illness.
Your attorney will have the power to perform all of the personal financial actions that you are able to. They can perform banking functions, purchase real estate on your behalf, sell your existing real estate, sign cheques from your accounts, and more. You can place restrictions on your Power of Attorney if you wish, to ensure specific actions are taken when it comes to particular areas of your finances.
There is also a non-continuing Power of Attorney for Property that comes with the same responsibilities, but it cannot be used if you become mentally incapable. This is beneficial if you need someone to look after your finances and properties while you are on an extended vacation or business trip out of the country, for example.
Power of Attorney for Personal Care
A Power of Attorney for Personal Care permits the person named as attorney to make decisions with respect to the care and treatment of a person’s health. This includes making medical decisions, entry into long term care facilities, and other important healthcare decisions. This type of Power of Attorney is continuing, and remains valid if you are incapacitated and unable to make healthcare and housing decisions for yourself. This could be due to illness, accident, or a severe medical event.
Work with a Qualified Lawyer to Assign Power of Attorney
Assigning Power of Attorney can be overwhelming, particularly if you have complicated affairs, like multiple properties, financial accounts, businesses, investments, or health concerns. A qualified estate lawyer can help you navigate the process and help you complete your estate planning in full to ensure your loved ones are taken care of.
The lawyers at Vandeputte Law in Dundas can ensure your Power of Attorney assignment is completely fully and with the exact specifications you are looking for. Contact us today for a free quote to find out more about Powers of Attorney sta the process.