Enduring powers of attorney (EPAs) have very much become the poor relation when it comes to asset planning documents. They used to be relatively common back when they were a simple one-page document. EPAs were often thrown in to complete the “full set” when setting up a trust or a new will.
So, what’s changed? To put it simply, the documents. Those one-page documents of the past are long gone. New documents with about 15 pages for Personal Care and Welfare and a whopping 20 pages for Property have replaced them.
I do often dream about those simpler documents and I wish we could still produce enduring powers of attorney for clients easily and for little cost. But, the reality is those old-style documents actually weren’t very good, for either party. The person giving the power of attorney had no ability to give any real guidance to the attorney(s) which of course left the attorney having to guess at what was expected of them. While the documents do seem a bit daunting at first, all the options have been designed to make you think about the things and the people that are important to you. We know these documents. We know what works and what doesn’t work. Once we know what you need, we can quickly prepare documents that work for you.
Make the decisions on who will decide for you
Putting enduring powers of attorney in place means that you get to call the shots about who controls your affairs when you are no longer able to and whether you want to put some restrictions on what those attorneys can and can’t do. The reality is, when a person has lost mental capacity there are a lot of decisions to make and those decisions often need to be made quickly.
In the absence of enduring powers of attorney, it may be necessary to make an application to the court to appoint a welfare guardian (which acts in the same way as an enduring power of attorney for personal care and welfare) and a property manager (which acts in the same way as an enduring power of attorney for property). This is a time-consuming, expensive process and the outcome might be that the people appointed are not the people you would have wanted. You have the opportunity to make these important decisions for yourself, why wouldn’t you take it?
Choose your people well
Deciding who to appoint as your attorney requires careful consideration. It can be interesting watching people work through this process, particularly when it comes to deciding which children are worthy of the honour. The minimum age for someone to act as an attorney is 20, so it’s not yet time for me to change my documents to appoint my children.
Personal care and welfare
When it comes to deciding on an attorney for personal care and welfare, the question is almost always “which one of my children is the nicest?”. Personally I think that’s a fair way to look at it. This is the person who will decide on the best way to manage your care, you definitely want someone “nice” but ultimately you want someone who knows what things are important to you. It might interest you to know that there are a few things that your personal care and welfare attorney cannot do:
- adopt out your children;
- agree to you receiving electro-convulsive treatment;
- or consent to any brain surgery or treatment designed to change your behaviour.
For the role of the property power of attorney, the question is generally “which of my children is the best with money?”. Again, it’s a valid question but you can have more than one person act for you at the same time which makes the role more complex. And that raises the question of how well your children can work together!
Even after spending six weeks locked up together, I definitely think both my children fall into the “nice” category. I’m not so convinced either of them is particularly good with money, however, but I’ll give them a few years. If your own parents have appointed you as their attorney, you now know what they think of you. I don’t like to brag but, I’ve been appointed to both roles – and no, I’m not an only child.
Seek good advice
It’s a common theme with all asset planning documents. Getting good advice and knowing all your options is key to ensuring the final documents achieve your wishes. Don’t be put off by the amount of detail required to accurately reflect your wishes. It may be one of the most important documents you put in place to protect both your assets and your family. We’ve created many EPAs for clients over the years and know how to make the process as straightforward as possible. Do get in touch with me or Monique Mackie if you are considering creating an EPA.
I think I should be able to fit in my last topic, ‘relationship property’ before returning to the office. It’s a good one to finish up with. Living in a bubble is really starting to lose its shine for some. I’ve definitely got some friends experiencing “bubble trouble”. As you can tell, I’m very hopeful that we will move to level 2 soon. In our house, we’ve been discussing what we will do when we are allowed back into the real world. My daughter is planning a trip to Kmart with her friends. And for my son, it’s a trip to Denny’s with “the boys”. What is it with teenage boys and food?
By Angela Mills