What is a Power of Attorney?
A general power of attorney is a legal document that allows you (the principal) to nominate one or more persons (referred to as attorneys) to act on your behalf. It is a legal document that transfers the rights to make decisions about your finances or assets including buying and selling real estate, shares and other assets for you, operating your bank accounts, and spending money on your behalf.
It is worth noting that A Power of Attorney cannot be used to make any decisions relating to your medical care. This falls under Enduring Guardianship and this is a separate power altogether. An Enduring Guardianship authorises the medical treatments and your day to day living issues.
What is an Enduring Power of Attorney?
The Enduring power of attorney is like power of attorney. The major difference being that the attorney’s power continues even if for any reason you lose your mental capacity to manage your own affairs. Once you lose your mental capacity you cannot revoke this power of attorney.
Why do I need a Power of Attorney?
A Power of Attorney can be useful if you are going to travel and need someone to operate your bank accounts to pay bills while you are on holiday or in your absence in case of accidents which may leave you unable to manage your own affairs or if you believe you may soon fail to be of sound mind.
How long does Power of Attorney last?
You can revoke Power of Attorney at any time provided you are still of sound mind. While Power of Attorney can last for a specific period, Enduring Power of Attorney can continue to function after you are unable to make decisions on your own.
Power of Attorney will cease once you pass away.
Do I need to Change it? How Often?
This is determined by the individual document and the circumstances surrounding its creation. There is no requirement to change Power of Attorney, but it is advisable to update it should the relationship between you and the nominated person change.
Prepared by Ajay Singh
Redline Legal –(Lawyers in Estate Planning and Will)
Parramatta Lawyers
