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What older residents should know about power of attorney

It's inevitable. Everyone -- if he or she is lucky -- gets old. And when thinking about the future, many British Columbia residents think about estate planning and that includes a power of attorney. Planning ahead for old age is one of the most important things a person can do and that means choosing someone to make crucial decisions when one can no longer do so oneself.

Seniors are some of the most vulnerable segments of society. Choosing an individual to help manage their affairs is not only important, but necessary. A person should never feel pressured by the one to whom they've granted the authority to look after his or her financial and personal needs. An individual needs to be capable mentally when signing a power of attorney for the document to be legal and valid.

Estate administration: Keeping the wealth in the family

People work hard for their money. Having a family's wealth protected from unforeseen events like divorce will likely ensure that when the time comes for estate administration in British Columbia, there won't be issues connected with a divorce. The last thing prosperous Canadians want is for the money they've worked so hard for to end up going to those who they wouldn't want it to go to and that sometimes means to a divorced adult child's former spouse or common law partner.

The issue is apparently causing many affluent Canadians grief. A recent survey showed these folks don't trust their heirs' partners when it comes to managing an inheritance. Although it may mean an uncomfortable discussion, wealthy parents of adult children should make their feelings known if such is the case. There is one saving grace in that in most provinces any gifts or inheritances received during a marriage are not included in the net family property if they are not part of overall family assets such as a matrimonial home or joint bank accounts.

Estate administration: Keeping the peace among family members

One of the issues in the back of most people's minds when they think about planning their estates is how to keep everyone happy. That goal may be much easier to attain and estate administration much simpler when British Columbia residents put into place some pertinent things in place when writing their plans. One of those includes choosing the right executor to administer the will.  

Being reasonable in every aspect of estate planning will likely keep family members from tearing each other apart when the time comes for a plan to be executed. And that not only goes for money, but for personal effects as well. A testator wouldn't want anyone fighting over items considered to have sentimental value such as an heirloom handed down from generation to generation. Not everything included in a will has a great monetary value and sometimes items that have emotions attached to them can cause more problems. So, it is necessary that an honest, open discussion should take place around these things.

Can certain people be left out of wills in British Columbia?

Most people believe they should be fair when writing their estate plans. But when a British Columbia testator (one who writes a will) doesn't have children of his or her own and would like to leave assets to nieces and nephews, he or she may feel like those assets should be divided equally among those relatives. However, wills aren't one size fits all and if a testator feels closer to certain nieces and nephews than others and would like that reflected in an estate plan, he or she has every right to do so. 

As long as a will satisfies legal obligations, a person can leave his or her assets to whomever he or she pleases. A niece or nephew who would have received a share in intestacy had there been no will would have standing to contest the will if there are valid grounds to do so. Such may be the case in the instance of undue influence or testamentary capacity etc. 

How much authority does a power of attorney really have?

When choosing someone to look after their affairs when they are incapable, Canadians have to keep a few things in mind. Those who hold a financial power of attorney in British Columbia are in positions of authority over someone else's money, so choosing a person who is trustworthy and knows something about finances is pretty important. That being said, there are certain things such a person can't do according to the law.

If the person who has the power of attorney wants to make drastic changes to the grantor's will by renaming beneficiaries or gifting money to family members or charities, he or she could find him or herself in some legal trouble. It all depends upon the laws of the province in which the grantor resides. And the grantor's will should be reviewed to ensure any gifts are keeping in line with an existing will.

Separating Couples Must Change Their Wills Immediately

Many couples think that the process of separating from each other will automatically change their wills, powers of attorney, insurance beneficiaries, representation agreements and trusts. It does not. The two ex-spouses are in for a rude shock. If they do not actively change these documents, their ex-spouse will remain the beneficiary of their wills and retain any authority assigned to them in a power of attorney or representation agreement.

This is true even for divorcing couples as far as powers of attorney and other estate planning documents are concerned. Under British Columbia laws will unless the testator ex-spouse clearly states that their divorced spouse is to receive a bequest. But all other documents remain unchanged.

Wills still need to be hand signed in British Columbia

The 21st century is no doubt the technological age. Many legal documents are actually executed online using an electronic signature. But when it comes to wills, it's not that easy for British Columbia residents. Actually, all Canadians can electronically sign invoices, quotes, proposals, contracts and many other kinds of documents. Wills, however, are another story. 

E-signatures are governed by both federal and provincial laws. All provinces and territories, along with the federal government say wills, along with some other documents like those pertaining to family law, must be in hard copy form and signed by hand. Only when they are signed as such do the courts consider them to be legal.

The need for wills even when accounts have beneficiaries

People who have worked hard all their lives and have several accounts with sizable assets -- like life insurance policies or retirement savings plans -- still need to plan their estates. British Columbia residents who have beneficiaries attached to these assets still need to write wills to streamline the process of disseminating specified assets when the time comes. Assets are frozen upon the death of their owner.

A will is necessary since it allows an executor to do many of the things required by law when a person passes away. A will gives the executor the right to file and sign a final tax return, liaise with creditors and basically take care of anything associated with the deceased person's estate. Many people don't realize that if a spouse is not the executor, he or she can't automatically take on that role. So, those who die intestate (or without a will) may leave a lot of messy loose ends for their loved ones.

Online wills may be estate planning mistakes in British Columbia

It's important to plan for the inevitable. Estate planning should be a part of every adult British Columbia resident's life, but for many people writing wills is the last thing on their radar. When they do think of it, they might resort to doing it the best way they believe is possible. Some turn to online forms, but they may be sorely misguided.

Online will forms, according to most experts, are not reliable and as such actually come with disclaimers. The average person wouldn't know if these forms contained mistakes or included things that weren't legal. Wills are meant to be unique -- reflective of personal situations, not one size fits all. 

Power of attorney essential for those with dementia

When a person receives the diagnosis of dementia, his or her world changes. There are so many things to consider, especially when the diagnosis is made early on. In British Columbia, it is important for people who have dementia to take action to protect themselves financially and that includes having a power of attorney in place in estate plans. 

There are safeguards that can be put into place such as having daily limits set on bank and credit card accounts in case the person forgets how much he or she has spent. The capacity to make financial decisions wanes with certain illnesses. It's important to ensure people are protected and one of the ways to do so is with a power of attorney.

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