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Why is it worth it to draw up a continuing power of attorney in time?
Preparing a continuing power of attorney is an essential part of your estate planning.
“The purpose of a continuing power of attorney is to give you peace of mind. You naturally hope it will never be needed, but it’s a safe way to prepare for the unexpected. The document does not immediately entitle the attorney to make decisions on your behalf because it is activated only if you are no longer able to manage your own affairs.
The document must be prepared while you are still legally competent, meaning you have the capacity to enter into binding legal agreements. If you are involved in an accident or fall seriously ill, your ability to act may weaken temporarily or permanently. In such a situation, your continuing power of attorney becomes important. Has one been drafted? What does it authorise?
Having a continuing power of attorney makes things easier for your loved ones if they must handle your affairs on your behalf. In discussions with customers, many are surprised to learn that a close family member, such as a spouse, cannot automatically manage your bank accounts. A continuing power of attorney prevents this problem.
When your estate planning is professionally handled, you can focus on the most important things in life knowing that potential risks have been addressed.”
How does a continuing power of attorney work in practice?
“If you don’t yet have a continuing power of attorney, I strongly recommend preparing one. As our Premium customer, the easiest way is to include it in your Wealth 360 plan.
When drafting the document, it’s wise to consider your wealth, family situation and circumstances as a whole. The content should also align with your and your family’s other legal affairs, so it’s smart to prepare it alongside other documents, such as your will, to ensure everything works smoothly together.
It’s important to remember that the document reflects your situation at the moment it is drafted. Over time, your wishes, family relationships, assets and even legislation may change. That’s why it is advisable to update old documents and prepare new ones with the help of an experienced legal counsel. Each continuing power of attorney is unique.
For example, if you want your attorney to be able to sell real estate you own or gift money or property on your behalf, these must be specifically authorised in the document.
Conflicts of interest must also be considered carefully. Your appointed attorney is disqualified and needs a substitute if their personal interests conflict with yours. Temporary conflicts may arise, for example, in an estate or during the sale of property between relatives. A disqualified person cannot make decisions for you. For all these reasons, everyone should have a valid continuing power of attorney, and the original document should be stored safely.
Don’t leave your future – and that of your loved ones – to chance. Book a meeting with one of our wealth management legal counsels. My colleagues and I are here to help.”
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Wealth management legal counsel Iiro Suomalainen has years of experience supporting customers in preparing for life situations important in estate planning.