What is a Power of Attorney? What are the different types?

Life is unpredictable, and you may unexpectedly find that you are no longer able to make decisions due to an injury or illness. You could also lose legal capacity to make decisions, or are travelling overseas and need someone to make decisions for you while you are away. By appointing a POA you can choose and control who makes these decisions for you.

What is a Power of Attorney?

A Power of Attorney (POA) is a legal document that allows you to nominate a trusted person, known as an ‘attorney, to make financial or lifestyle decisions on your behalf while you are still alive.

What are the different types of Power of Attorneys?

Before you nominate an attorney, you should consider the 3 different types of POAs.

Powers GrantedRestrictionsExamples
Power of Attorney
Make decisions on financial or property-related matters onlyPower is given for a specified period of time

Power does not continue when you lose the legal capacity to make decisions
Running a business while you are overseas for 2 months

Buying or selling real estate for you
Power of Attorney
Make decisions on all matters (personal, financial, property)

Power continues to operate even if you no longer have decision-making capacity
Medical decisions cannot be made under this PowerChoosing a place for you to live

Paying bills

Prepare your tax returns
Power of Attorney
Assistance to help you make your own financial, personal or other decisions while you still have capacity The Supportive Attorney cannot make decisions for youAssistance with communicating decisions to banks and utility providers

You can also appoint more than one attorney. If selecting two or more attorneys you should specify how you want them to make decisions. Attorneys can act jointly, independently, or by a majority.

Note that none of the Power of Attorneys allow for medical decisions. If you are seeking to appoint a person to support or make medical decisions on your behalf, you would be looking to appoint a medical treatment decision maker. An appointed medical treatment decision-maker will have the legal authority to make medical treatment decisions when you are no longer able to do so.

Mitigating Risks

Whilst appointing Power of Attorneys is important, you should also consider and reduce the risk of things going wrong. A few ways to reduce risk are by reviewing your Power of Attorney every year or appointing more than one Attorney, so decisions are made jointly. You can use this helpful checklist or speak with a professional when making a Power of Attorney

Contact W Legal Group

W Legal can help you navigate the forms and execution requirements needed to appoint an Attorney. Speak with us today to start your future planning!

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