An EPA gives a person the authority to make decisions on your behalf if you are unable to cope, due to illness, failing health, or a bad accident.
Along with a will, an EPA is a crucial legal document that everyone should have in place.
There are two types of EPA;
– The other specific to your “property” – a legal term meaning all of your assets.
You would normally appoint your spouse, but also another person in case your spouse has already died. You can appoint two different people, or the person you appoint can do both.
Always appoint someone who is much younger than you.
There have been too many cases of elder abuse so recent governments tightened up on the rules and EPA’s can now cost over $1,000. However in some cities the less well off can make EPA’s at community law centres for much lower costs.
Whenever you go to make a new will, make an EPA at the same time. Cost may be contained by doing them together, but to avoid cost shocks, always ask for a cost estimate first.
Your EPA appointees
Normally you would appoint your spouse but in case they predecease you, appoint another person as well.
A lot of people like to appoint their children, but if you have any doubt whatsoever, consider appointing a solicitor instead. Or at least appoint your solicitor to manage your money, property and your assets.
For more information on EPA’s go to www.ageconcern.org.nz/epa
70% of the victims are elderly woman.
80% of the abuses are committed by family members.
An elderly woman lent her daughter a credit card to buy a fridge. The daughter bought the fridge, then went out gambling and ran up a further $6,500 on mum’s credit card. Not surprisingly the daughter could not repay the debt.
A 77-year-old man allowed his 38-year-old grandson to move into a downstairs unit in his home. The grandson then invited a friend to move in and granddad ended up paying some very big power bills that he simply could not afford on NZ super.
Granddad raised his concerns with his grandson and his friend, but both of them started yelling abuse at him and threatening to damage the house.
In another case, a financially pressed son sold mum’s nice home and put her in a miserable little flat and helped himself to the leftover cash.
Sadly some of the elderly abused feel embarrassed and foolish, and are reluctant to do anything about it.
Elder abuse really happens
Before you say that won’t happen in our family, remember we don’t know what will happen to our children or their finances or their jobs.
We don’t always know about our children’s spouses and their ethics or values.
Any caregiver may be under financial pressure and act inappropriately.
Put someone you can absolutely trust in charge of your affairs, and no one else.
Some caregivers are fantastic but sadly some are not to be trusted.
Dad was very ill and was looked after by a caregiver some months before he died. The son man then discovered that dad had made a very recent will and left everything to the caregiver.
The son went to court and spent $20,000 in legal fees, and was awarded the family home, but the caregiver got off with over $2100,000..
You want mum or dad to have the best care especially if they are very ill. However you need to watch out for caregivers who ingratiate themselves a little too much, and take over a little too much.
A starter scam
A caregiver spins a “sob story” about being unable to afford to travel to visit a sick relative, or help a special needs child finish school. They persist with this tale of woe until the victim finally offers to cover the cost.
Of course, this may be just the start. Once they realise this will work, they're likely to repeat it. Very often, other members of the family are unaware of this, and the victims, especially the elderly, are often quite secretive about it too.
This article was supplied by Alan Clarke who is the author of a book entitled “Retire Richer” which is a practical guide for everyone age 25 to 85.
Alan also writes regular articles on www.acfs.co.nz
Alan is an independent authorised financial adviser (AFA) and his disclosure statement is available on request and free of charge.