While your Will names an Executor who will handle the administration of your estate after you die, a Power of Attorney is a document that appoints another person to handle your affairs. This includes making important decisions about your healthcare, finances, and/or property in the event that you are incapacitated or incompetent. You typically write these documents at a time when you have full capacity, to come into effect if you were ever to lose capacity.
We have written extensively on the importance of a Financial Power of Attorney in other blog articles. It is a critical document no matter what your family situation happens to be.
Unlike Wills, which are generally recognized throughout Canada regardless of the province in which they were drafted, the law regarding Powers of Attorney can differ quite a bit between provinces. This means there is no such thing as a “Canadian Power of Attorney for Finances” or “Canadian Power of Attorney for Healthcare.” Instead, these documents may have different names, and different legal requirements for validity, depending on your province of residence. This article will attempt to explain some of these differences, and how LegalWills.ca simplifies the process of creating a new Power of Attorney for every province in which you hold assets.
Powers of Attorney and Healthcare Proxies
As explained in our article about essential estate planning documents, a Financial Power of Attorney gives someone else authority to make decisions about things like whether to sell your home, manage your investments, pay your bills, and file your taxes on your behalf while you are incapacitated. Depending on how it is drafted, a Power of Attorney can be specific, for example limited to certain property (like your home or investment portfolio), or general, permitting complete control over your finances.
Generally a Power of Attorney written to cover a specific asset is put in place when you are unavailable rather than incapacitated. For example, if you are travelling overseas and you need somebody to sell your car on your behalf, you can do this with a specific Power of Attorney. For the purposes of estate planning, a Power of Attorney is usually a “General” Power of Attorney which says “if I was to ever lose capacity, I would like this person to take control of my financial affairs for me.”
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