What is it? What types are there?
Many people set up a Power of Attorney to enable another person to manage their personal and financial affairs in the event of unexpected circumstances such as travel or illness. When doing this, it’s important to seek legal advice to determine what best suits your situation and to help you with the process.
A Power of Attorney (POA) is a legal document in which an individual (‘the principal’) gives authority to someone of their choosing (‘the attorney’) to manage their financial affairs.
Depending on the type of POA, this might be for a limited time, such as when the principal is overseas or temporarily sick, or it might be a longstanding arrangement which continues after the principal has lost the ability to make decisions for themselves.
In either case, it’s important that the attorney can be trusted to act in the best interests of the principal. Choosing the wrong person can leave the principal vulnerable to financial abuse and fraud.
A General Power of Attorney (GPOA) is a legal document which grants an attorney permission to make financial decisions on a principal’s behalf, usually for a limited period of time or for the duration of a specific task. One example might be if the principal needs someone to manage their financial affairs while they’re temporarily out of the country.
A GPOA is only valid while the principal is capable of making their own decisions.
An Enduring Power of Attorney (EPOA) grants similar permissions to a GPOA and is typically prepared by a principal who wishes to ensure their financial affairs are protected in case they lose capacity in the future. Please be aware that an EPOA can only be granted while the principal is capable of making decisions themselves.
Some EPOAs may commence immediately (even if the principal has capacity), and some may commence from the time the principal has lost capacity.
For more information on setting up a Power of Attorney on your Horizon Bank accounts, contact your local branch
