Why You Need Power of Attorney
Are you wondering why you need power of attorney? Most people know that they should have a will in place.
This is done to make sure that if you pass away that your loved ones will be taken care of. They will have some direction as to what you wish to have done with your possessions. Many people don’t consider what happens in the case where you are injured and unresponsive. If you suffer a head injury and can no longer speak or express yourself, what happens then?
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What is a Power of Attorney?
It is a legal document that you give to someone to give them the power to make decisions for you, or to able to do things for you. It can be:
- Paying bills
- Selling assets
- Making health decision
- Taking money out of your bank account
- Making investment
- Many other things
The person that you give power to is called the “attorney.” Please note that this person does not have to be an attorney or a lawyer. The term is very confusing and should probably be changed.
The difference between a will and the power of attorney (POA) is that POA is in effect when you are alive, a will takes effect when you die.
Why Do People Have POA?
One common reason is that the person making POA will not be able to look after decisions and obligations when they are injured or away travelling in another country. Someone might give POA the ability to pay bills while they are away travelling.
If someone is in the hospital, their bills will also still have to be paid. Insurance for the house and car will still have to be paid. The mortgage must still get paid.
POA is not expensive, so everyone should consider doing it.
Who Should I pick as Power of Attorney?
There are two minimum criteria to be appointed as POA:
- The person understands what they need to do (it’s better that they speak to an estate lawyer first)
- They must be 19 years old or older
Most people pick a family member. You can also pick the government (public guardian) or a trust company. The “attorney” will have a lot of power, so give it some thought before deciding. It’s also best if you speak to the person to make sure they want to do it. It is also possible to name multiple people in case something happens to one of the “attorneys.”
Who makes your decisions for you and what happens to your assets? Most young adults would not consider this to be an issue. Most young adults do not think about getting wills created as they feel it is something they can always deal with when they are older. However, piece of mind and security that can be created in a few short hours now, could save days and potentially years of stressful litigation for family members and friends in the far future.
Why You Need Power of Attorney
When consulting a lawyer in Ontario about estate planning, you should always ask about power of attorney. Although power of attorney documents are typically short, seemingly unimportant documents, those few pieces of paper can save your loved ones tens of thousands of dollars in the long run. If you do not have a signed power of attorney to deal with your healthcare and property, your family will likely have to apply for guardianship over you. This process can take sometimes several months or even longer if there are multiple people trying to obtain guardianship status.
You should have discussions surrounding who you want to be in charge of your investments. You also want to think about your vehicles and specific assets. This can all be encompassed into a power of attorney. These directives are vital in situations where multiple children, siblings and sometimes spouses and ex-spouses are present. You want to think about who should actually be the person acting in your best interest.
When no power of attorney exists anyone of these persons can bring their own application. They can be confirmed as your guardian. This is true even if their intensions are self-motivated.
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Still wondering Why You Need Power of Attorney? Call our estate lawyers toll free at 844-466-6LAW (529)
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