What is a Power of Attorney, and do you need one?
Published on July 14, 2023 by Dianne Retief
Life can often be unpredictable, and there may come a time when you cannot manage your affairs due to various circumstances. In NSW, a Power of Attorney offers a legal solution to allow someone you trust to make important legal and financial decisions on your behalf. This article explains what a Power of Attorney is and why you might need one.
What is a Power of Attorney?
A Power of Attorney is a legal document that gives a person or trustee organisation the legal authority to act for you to manage your assets and make financial and legal decisions on your behalf.
Types of Power of Attorney
There are two types of Power of Attorney documents:
1. General Power of Attorney
This type of Power of Attorney grants the attorney authority to make financial and legal decisions on your behalf only while you can make your own decisions. This means it becomes invalid if you lose mental capacity.
2. Enduring Power of Attorney
An enduring Power of Attorney allows the attorney to manage your financial and legal matters even if you lose mental capacity in the future. This type of Power of Attorney provides continuity and peace of mind.
Why would I need a Power of Attorney? And what can they do?
- Incapacity or illness
Life can bring unexpected challenges like accidents, illnesses, or mental incapacity. Suppose you become unable to make decisions or manage your affairs due to such circumstances. In that case, a Power of Attorney allows a trusted person to step in and handle matters on your behalf. They can manage your financial affairs, such as paying bills, and ensure your overall well-being is taken care of.
- Travel or absence
Having a Power of Attorney can be valuable if you plan to travel extensively or live abroad for an extended period. It allows someone you trust to manage your affairs back in NSW while you are away. They can handle property transactions, sign legal documents, and handle financial matters, ensuring your interests are protected, and decisions are made in your best interest.
- Business or financial management
A Power of Attorney can be essential for individuals who own businesses or have complex financial affairs. It enables a trusted person to manage your business operations, sign contracts, make financial decisions, and handle tax matters on your behalf. This can ensure continuity and prevent disruption in the smooth operation of your business or financial affairs.
- Ageing and declining health
As we age, our ability to manage our affairs may diminish. Having a Power of Attorney in place early on allows you to choose a trusted individual to act on your behalf when you can no longer do so effectively. This ensures your wishes are respected, financial matters are handled appropriately, and healthcare decisions align with your preferences.
- Real estate transactions
A Power of Attorney can be invaluable if you own property in NSW and cannot attend to a property-related matter. It allows your attorney to sign documents, manage property transactions, pay property-related expenses, and handle other legal issues related to your real estate.
- Legal and administrative affairs
There may be situations where you require assistance with legal or administrative matters but cannot be present. A Power of Attorney enables your appointed representative to attend legal hearings, sign legal documents, communicate with government agencies, and handle administrative tasks on your behalf.
A Power of Attorney is a crucial legal tool allowing someone you trust to act on your behalf in various situations. Having a Power of Attorney ensures your affairs are managed according to your wishes and best interests. By consulting with a lawyer, you can create a Power of Attorney document tailored to your unique needs and which provides you with peace of mind, knowing that your interests will be protected in any circumstance.
You can contact us at Carroll & O’Dea Lawyers on 1800 059 278 or via our Contact Page if you need help with a Power of Attorney, and one of our lawyers will assist you.