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When to take out an enduring power of attorney

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An enduring power of attorney is something we should all consider, but knowing when to make one is equally as important.

It is therefore essential for you to consider the timing.

Your attorney's power continues after you have lost the mental capacity to make decisions about your financial affairs.

The power of attorney 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 enduring power of attorney 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 enduring power of attorney is made as part of your broader estate planning and probably years before you ever intend for it to come into 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 that you trust and who is more than capable of dealing with all your financial arrangements when the time comes, no matter how complex.

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Peter Townsend is principal of Townsends Business and Corporate Lawyers.
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