A Power of Attorney is a legal document in which you appoint the person or trustee organisation of your choice to manage your assets and financial affairs while you are alive. A Power of Attorney only deals with property and financial matters, and enables your attorney to sign legally binding documents on your behalf. In NSW, a Power of Attorney can only apply to financial or legal matters.
You may, for instance, be travelling overseas and want to give your attorney access to your bank accounts to pay your bills or manage your finances. Alternatively, it can be useful to have a Power of Attorney if you become unwell and are no longer able to manage your financial affairs.
Making a Power of Attorney does not mean that you will lose control over your financial affairs. It simply gives your attorney formal authority to manage your financial affairs according to your instructions. Your Power of Attorney can be revoked at any time provided you have the capacity to do so.
Matters your attorney is able to handle include:
• Receiving income
• Paying bills
• Taxation and contractual issues
• Investment or property management
Enduring v Ordinary Power of Attorney
An ordinary Power of Attorney can only operate while you still have the capacity to make decisions. An Enduring Power of Attorney continues after you have lost capacity. You can make an Enduring Power of Attorney which will continue to have effect after you have lost your capacity to self-manage. This is important for everyone, but particularly for elderly people.
A Power of Attorney does not relate to decisions about your lifestyle, medical treatment or welfare. Where you live, who you live with, what health care you receive, and daily issues like diet and dress are covered by Enduring Guardianship.
A Power of Attorney ceases when you die. The executor named in your Will then takes over the responsibility of administering your estate.