Will & Estate Planning: The Importance of a Power of Attorney
What is a Power of Attorney? A power of attorney is a document that gives someone else the right to act on your behalf. There are different types of powers of attorney: • Continuing power of attorney for property, which provides for a person of your choosing, also known as your “Attorney” to handle your
What is a Power of Attorney?
A power of attorney is a document that gives someone else the right to act on your behalf. There are different types of powers of attorney:
• Continuing power of attorney for property, which provides for a person of your choosing, also known as your “Attorney” to handle your financial affairs and allows your Attorney to act for you if you become mentally incapable.
• Non-continuing power of attorney, which allows your Attorney to handle your financial affairs but cannot be used if you become mentally incapable. We would generally advise someone to have a non-continuing power of attorney in the event that they were away from home for an extended period of time.
• Power of attorney for personal care, which covers you for personal decisions relating to your house and health care.
Is having a Power of Attorney really necessary?
In my opinion, it depends on where you are in your life. You’ll note that in the statistics set out below, the older people are the more likely they are to have a power of attorney. I will admit that I do not currently have a will or any type of power of attorney, however I will be getting married this year and it is something that I will strongly consider putting in place.
Once you get to that stage where you’ve decided it has become necessary I would advise you to have it done sooner rather than later. We have individuals come to our offices all the time telling us that that their family member is sick and they don’t have a power of attorney.
These situations can quickly become very complicated and costly. I can assure you that having your lawyer draft a power of attorney is very cost effective in the long term. Please do not hesitate to contact us if you have any questions regarding power of attorneys.
I’ve reproduced some interesting facts set out in the Scotiabank article regarding Canadians and their wills and powers of attorney:
• The appointment of a power of attorney increases with age: 18-34 (15%); 35-44 (18%); 45-54 (28%) and 55+ (58%).
• The percentage of Canadians with a will increases as they get older: 19% for 18-34 year olds; 30% for 35-44 year olds; 50% for 45-54 year olds; and 86% for those 55 and older.
• Among Canadians who do not have a will (50%) the top reasons include not having enough assets to justify making a will (29%), not knowing where to start (24%) and being too young for a will or don’t know (both 23%).
• Among Canadians with a will and a financial plan, nearly 8 in 10 (77%) had a lawyer or a notary help them create it, while 14% did it themselves and 7% used a financial advisor.
• Just over half of Canadians (54%) say they have spoken to their family about their intentions for their will.
• Of those who have not spoken to their family about their will (46%), the top reasons for not doing so are: they haven’t thought about it (64%); their will is a private matter (17%); and that it is too soon to speak with them (11%).