Boomers entering retirement need to make arrangements for a longer life
Life is a little like a boomerang throw. In the beginning, we’re dependent on family. Later, we swoop out into the world, go to school, build careers, start families and maybe even take trips to Australia. Then, as we age, we often find ourselves boomeranging back to where we began, and once again, needing help from our family.
This is especially true because of our increasing life spans: 83 years and growing in Canada. However, on average, only 72.6 years of that is spent in “full health.”* We are increasingly facing challenging health situations that may require us to ask for a little help managing our own affairs. What’s more, because of advances in health care, we’re living for much longer periods of time with these health situations.
For all of us, there may come a point when we may need help managing investments, paying bills or assessing medical care options. But that doesn’t mean we have to lose our autonomy. Arrangements can be made ahead of time, and powers can be delegated to people who will respect and carry out our wishes.
You’ve got the power
An essential part of these arrangements is your power of attorney, or POA, which legally entitles people you choose to conduct your affairs on your behalf if you are incapable or unavailable. There are two basic types of POA (called a mandatary in Quebec): for property and personal care.
Property: Day-to-day banking, managing investments and real estate decisions require attention if we become physically or mentally unable to handle such matters ourselves. If this happens, it’s important to have an enduring or continuing POA come into effect.
Personal care: This type of POA appoints who will make personal and health-related decisions on your behalf regarding healthcare, medical treatment, housing, hygiene and more. In some provinces and territories, you can also write down health directives that dictate what course of action to take if you can no longer communicate your wishes. This can reduce the burden on your loved ones, who might otherwise have to make those decisions on their own.
What happens without a valid POA?
Many of us assume our spouse or next of kin will automatically be appointed as our POA if we become incapacitated. However, each province and territory has specific rules for guardianship and decision-making. Determining POA responsibilities through the courts can be lengthy and expensive, and a burden on your family.
Selecting your POA
Consider whether your potential POA is able to manage family conflict, and has the time and financial savvy to carry out your wishes. To be named a POA is often considered an honour, but family dynamics, lack of expertise, time constraints and personal liability can be concerns. If this is the case, you may wish to consider working with estate and trust professionals, who can support your chosen POA(s) and/or carry out directives objectively, professionally and compassionately on your behalf.
* Public Health Agency of Canada, How healthy are Canadians? A trend analysis of the health of Canadians from a healthy living and chronic disease perspective, 2016.