You make a range of decisions and choices about how you spend and invest your money on a daily basis.
If an accident or illness prevented you from being able to make financial decisions, or attend to the payment of bills and expenses, you would want to have some level of control over how these transactions were carried out on your behalf. Due to the legal requirements of the Land Titles Office, financial institutions, telephone and power companies, if you are unable to attend to the transaction yourself, the person you have nominated requires the legal authority to do so.
A Power of Attorney is a legal document which confirms your authority for a family member, friend or other trusted person to make financial decisions and enter into property transactions on your behalf. It is therefore one of the most important elements of your estate plan.
Types of Powers of Attorney
An ordinary, or “general”, power of attorney is used when, although you are capable of managing your own affairs, there is some specific reason why you won’t be able to. This can be particularly useful if you are unable to attend to your financial affairs due to work commitments (for example, your work in a remote location), you are travelling interstate or overseas, or perhaps you would simply prefer that your partner or another person deal with financial transactions on your behalf.
The benefit of an “enduring” power of attorney is that it will continue to operate even if you have lost full legal capacity, for example if you are unable to communicate after a stroke or become senile. Taking the time to make an enduring power of attorney means that your financial affairs can be looked after by someone you know and trust.
Peace of Mind
Not having a Power of Attorney can create significant legal issues for family members.
Having a Power of Attorney can save legal costs in the long term should problems arise with financial transactions.
Most importantly, having a Power of Attorney gives you peace of mind knowing that your financial affairs have been addressed in your estate plan.