The real cost of not having powers of attorney in Ontario
Disclaimer: This article on the powers of attorney is intended for the purpose of providing information only. It is to be used only for the purposes of guidance. This article is not intended to be relied upon as the giving of legal advice and does not purport to be exhaustive.
One of the only constants in life is change. Our circumstances can change at any moment. And we cannot understate the importance of preparing for whatever comes our way.
At Beeksma Law, we want you to be able to protect your families, your assets and your wishes. That is why we strongly encourage our clients to have powers of attorney for personal care and for property.
Because the cost of not having them in place is too high.
In this article, we will talk about why it is imperative that you have powers of attorney prepared. Then we will discuss what can happen if you fail to do so. If you would like to discuss your estate planning, please get in touch with our office. We would be more than happy to help you discuss your options.
Why you may need a Power of Attorney
The Power of Ontario Act governs powers of attorney in Ontario and gives someone (an attorney) the power to act and make decisions on your behalf if you become mentally incapacitated. You may be deemed mentally incapable and unable to decide about your property or personal care for various reasons. For example, it may be because of an accident or the result of an illness.
To be fully protected, you will want to prepare each type of power of attorney: a power of attorney for property and a power of attorney for personal care.
A power of attorney for personal care covers decisions about your personal care. For example, it may include decisions about your medical treatment, health care, where you will live, and the type of care you will receive.
On the other hand, a power of attorney for property covers decisions related to your finances and property. This can include paying bills, managing investments, and buying or selling property.
What happens if you do not have a power of attorney?
As noted in this article, this is where powers of attorney and wills differ. If you die without a will, the Intestacy Act outlines what happens to your estate.
However, if you are incapacitated and do not have a power of attorney, there is no corresponding legislation that applies.
Becoming incapacitated without a power of attorney can significantly and negatively impact many areas of your life. If you are being treated for any health issues, your treatment may be delayed and your care may not be aligned with your beliefs or wishes. Another major consequence is that your property and finances may be left in limbo.
To remedy this situation, one of your loved ones will need to file a guardianship application with the courts to give them permission to act as your guardian and handle your affairs. Alternatively, the Office of the Public Guardian and Trustee (OPGT) may also be appointed to act on your behalf.
How much does a guardianship application cost?
The cost of a guardianship application can vary. However, your costs will be significant – and many times more than the cost of preparing your powers of attorney. This cost can be especially burdensome for families who are already struggling to manage the expenses of a loved one or family member who is incapacitated.
Even an uncontested guardianship application (meaning one where no one has any objections) will cost several thousand dollars. Contested guardianship applications can cost significantly more, and the expenses can quickly add up. The costs of a guardianship application may include attorney fees, court costs, and other expenses related to the application process, such as a capacity assessment.
In addition to the financial cost, there is also an emotional cost to not having a POA. The stress and uncertainty of not knowing who will manage your affairs can take a toll on everyone involved. It can also lead to family conflict and legal disputes, which can be especially painful during a time of crisis.
To avoid preparing powers of attorney to save money now – only to pay much more later – would be penny wise, pound foolish.
Why everyone needs a power of attorney?
We often think about estate planning as being a priority for the elderly. However, the truth is that we do not know what the future holds for any of us. The fact is, we want to protect our loved ones. We do want to make sure that our wishes are respected – not only if we pass away, but if we are alive and unable to make our own decisions.
That is why we encourage you to have all of the essential legal documents prepared at the same time. The cost to prepare powers of attorney – especially if you prepare wills at the same time – is much lower than the alternative. And we cannot put a price on the peace of mind that comes from knowing that you have cared for your loved ones and your own future.
At Beeksma Law, we understand the importance of these legal documents and strive to make the process as easy and stress-free as possible. Our team will create customized legal documents – such as powers of attorney, wills, and trusts – that reflect your individual wishes. Contact our team today to get started.