Timing for power of attorney
An enduring power of attorney (EPOA) is something we should all consider, but knowing when to make one is equally as important. It is therefore essential to consider the timing.
Your attorney’s power continues after you have lost the mental capacity to make decisions about your financial affairs. The EPOA will need to be explained to you by a “prescribed witness”, such as a solicitor or even, if you’re overseas, a legal practitioner qualified in a country other than Australia. Accordingly, a valid EPOA should be done before you are ever at risk of being deemed not to have capacity to deal with your finances. It is recommended that an EPOA is made as part of your broader estate planning and probably years before you ever intend it to take effect.
Whoever you choose as your attorney must be aware of their responsibility to act in your best interests. Therefore, you need to ensure it is someone you trust and who is capable of dealing with your financial arrangements, no matter how complex.
Peter Townsend, principal, Townsends Business & Corporate Lawyers