Who will make decisions for you, if you can't? The answer isn't as simple as you may think. Learn from about the importance of an Enduring Power of Attorney.
Who will make decisions for you, if you can’t? The answer isn’t as simple as you may think.
It is human nature to procrastinate, let’s face it. we should have written this article sooner than I did, but hey – we blame human nature.
Life is busy. No one likes to dwell on grim details and discuss the ‘what ifs’ of incapacity or death. Save those discussions for another day – when the kids are older, or even when the kids are born or just … not now.
But just because we put something off doesn’t mean we should. Nor does it mean we will ever get around to it. Or even be able to.
Case in point – an enduring power of attorney.
What is an Enduring Power of Attorney?
It is a document that allows any adult person of sound mind to appoint another to step into his or her shoes; to make his or her financial and legal decisions if need be.
If you are reading this then chances are you can prepare an enduring power of attorney. If, however, you suffer an injury or illness that causes you to become legally incapacitated then you will no longer have the requisite legal mental ability to prepare such a powerful document.
If you procrastinate in preparing an enduring power of attorney, then you are taking a risk. A risk that you might become legally incapacitated or unable for whatever reason (be it distance or availability) before making such a document.
If you don’t have an enduring power of attorney but need one, yet are legally incapacitated then interested family members or friends will need to do the hard work for you. They will need to fill out a lengthy application and obtain your financial details to provide to the Guardianship Board, before attending a hearing where a panel determines who, if any of them, would be suitable to be your attorney (which now becomes known as an ‘administrator’). If no one is deemed suitable, then the Public Trustee will be appointed.
And the powers your administrator are given are often restricted and require them to report to the Public Trustee on a recurrent basis.
It is not as simple as your next of kin stepping in and taking over your financial and legal decisions – unless you appoint them in an enduring power of attorney.
Why do you need an enduring power of attorney?
To deal with assets such as property, bank accounts, shares and motor vehicles there is paperwork you have to understand and sign. If you don’t understand or can’t sign, then your attorney can do it for you. And whatever your attorney does will be deemed as lawful – as if you did it yourself.
You can give your attorney broad power – the power to do almost anything that you yourself could do (subject to making a will and a handful of other acts) – or you can specifically dictate what powers you want them to have – for example, to only make legal and financial decisions regarding a specific bank account.
The document can also be used at various times. Taking some hard-earned leave? Planning a holiday? You can allow your attorney to act for you while you’re travelling overseas.
Or, if you are injured or sick and need to spend time in hospital, then your attorney can deal with those legal and financial decisions while you focus on your recovery.
Alternatively, you can allow your attorney to only act for you if you become legally incapacitated.
Procrastination is risky. And so is life. We needn’t tell you about the risks that we all face on a day-to-day basis. But there are some risks that can be avoided, and dealt with now.
An enduring power of attorney is a document you may never need, but it is certainly better to have one that is never used, than to not have one and need it.
Preparing an enduring power of attorney can save you, your family and friends a lot of hassle later. So sort your affairs out now, while you can.
For advice about your Will or Estate issue or to prepare a Power of Attorney, contact your nearest Tindall Gask Bentley office. You can also start your Will online here.
On August 1, 2017, the Relationships Register commenced in South Australia, giving greater legal recognition to LGBTQI and de facto relationships. To find out how the Register impacts your will click here.