Power of Attorney vs. Joint Accounts: What You Need to Know

March 11, 2025

Managing money isn’t just about budgeting and paying bills—it’s also about making sure the right people have access when you need them to. Whether you’re planning for the future or assisting a loved one, you may be considering a Power of Attorney (POA) or a Joint Account. While both provide financial access, they serve very different purposes. Let’s break it down so you can make the best choice for your situation.

What is a Power of Attorney (POA) in Ontario?

A Power of Attorney is a legal document that allows someone you trust (the attorney) to act on your behalf (the grantor) when it comes to financial matters. Depending on the type of POA, your attorney can help with tasks like paying bills, managing investments, and making banking transactions. However, they do not become an owner of your assets.

Types of POAs in Ontario:

• General POA – Gives broad financial authority but ends if the grantor becomes mentally incapacitated.

• Continuing (Enduring) POA – Remains valid even if the grantor becomes mentally incapacitated.

• Limited POA – Covers specific tasks or time periods.

• Springing POA – Takes effect only when certain conditions are met (e.g., a medical diagnosis of incapacity).

What is a Joint Account?

A Joint Account is a bank account owned by two or more people. In Ontario, most joint accounts come with rights of survivorship, meaning that if one account holder passes away, the surviving holder(s) automatically take full ownership of the funds. Unlike a POA, all joint account holders have equal access and control over the money in the account at all times.

POA vs. Joint Account: Key Differences

Feature	Power of Attorney (POA)	Joint Account
Ownership	Grantor retains full ownership	Both parties share ownership
Decision-Making	Attorney acts on behalf of grantor	Each account holder acts independently
Survivorship	Ends upon grantor’s death	Surviving account holder retains full ownership of funds
Control Over Assets	Grantor can limit attorney’s powers	All account holders have equal access
Financial Risk	Attorney has a legal duty to act in grantor’s best interest	Each holder can withdraw/spend without consent
Legal Termination	Ends when revoked, upon death, or if not continuing	Ends only if the account is closed or modified

Which One Should You Choose?

Go with a POA if:

• You need someone to manage your finances but don’t want them to own your assets.

• You want control over what they can and can’t do with your money.

• You’re planning for a time when you might be unable to manage your finances yourself.

Consider a Joint Account if:

• You want shared financial access with a spouse, partner, or family member.

• You’re comfortable with the co-owner using the funds freely.

• You want to ensure seamless access to funds after one holder passes away.

When to Become a POA or Joint Account Holder

You might need a POA when:

• A loved one requires financial assistance due to illness, aging, or incapacity.

• You want a backup plan for managing your finances if you become unable to do so.

• You want financial control without giving away ownership.

A Joint Account makes sense when:

• You share household expenses with a partner.

• You want easy access to joint savings or emergency funds.

• You need a practical way to share financial responsibilities with a family member.

When Does Access End?

For a POA:

• When the grantor revokes the POA in writing.

• Upon the grantor’s death (POAs do not survive death in Ontario).

• If it was a limited POA, access ends once the task is completed.

• If it was not a Continuing POA, it ceases when the grantor becomes mentally incapacitated.

For a Joint Account Holder:

• Access remains unless the account is closed or ownership is changed.

• If an account holder passes away, the surviving holder(s) take full control unless otherwise specified in estate planning.

Choosing between a Power of Attorney and a Joint Account depends on your financial goals and comfort level with access and control. If you need assistance managing money but want to retain ownership, a POA is the way to go. If you want shared access and control, a Joint Account may be more suitable.

Before making a decision, consider speaking with a legal or financial advisor in Ontario to ensure you choose the best option for your specific situation.

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