What’s an Enduring Power of Attorney?
An Enduring Power of Attorney (EPA) is a legal document outlining who you want to act on your behalf if you lose mental capacity and can no longer deal with your own affairs. This interview with solicitor Amanda Morgan explains how an EPA works in New Zealand.
Who sets up an EPA?
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The person setting up the EPA is called the donor, and the person they appoint is called their attorney. The attorney effectively steps into the donor’s shoes, and makes decisions and signs documents on their behalf.
Are there different types of EPAs?
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There are two types of EPA documents: one dealing with property which covers property that you own in your personal capacity – for example bank accounts, investments etc., and the other one deals with personal care and welfare matters – for example where you are to live and decisions relating to your medical care.
There’s a difference between the two in terms of when they can take effect. With personal care and welfare, the attorney’s appointment is activated if a medical professional certifies that the donor lacks capacity. With a property EPA, the donor can choose whether or not their attorney can act immediately, or only when they have lost capacity.
Can you define ‘mental incapacity’ for us?
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In respect of a personal care and welfare EPA, mental incapacity is defined by law as the donor lacking capacity to:
make a decision about a matter relating to his or her personal care and welfare; or
to understand the nature of decisions about matters relating to his or her personal care and welfare; or
to foresee the consequences of matters relating to his or her personal care or welfare, or any failure to make the decision; or
they may lack the capacity to communicate decisions relating to his or her personal care or welfare.
Who decides if you are mentally incapable?
A health practitioner or a family court. That could be a GP, a hospital registrar, or a geriatrician. Bear in mind that you can lose capacity at any age – for example a person may lose capacity due to a head injury caused by a car accident or dementia. I am 34 years old and have EPA’s in place to enable my husband (who I have appointed as my attorney) to deal with my property affairs if he needs to.
But your attorney doesn’t need to be a lawyer, do they?
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No – that’s just the title. Anyone over the age of 20, not bankrupt and who has mental capacity themselves can be an attorney. But remember, you’re giving the person or people that you are appointing very wide power to deal with your affairs, and that power can be abused. Appoint people that you know and trust. Likewise consider your family dynamics and, in the event you have appointed two or people to act together, that they will be able to work together.
With two EPA documents, does that mean two attorneys?
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Yes – however the attorneys may be the same for both property and personal care and welfare EPA’s or you may choose to appoint different people for each.
For personal care and welfare, you can only have one individual acting at one time. But you can oblige that person to consult with other people. For example, if I appoint my husband, I can say that he has to consult with my parents when making a decision. Decisions ultimately lie with the attorney, but at least other people are aware of what’s going on.
With a property EPA you can have as many people as you like – ie two or more people acting together at the same time or you can have a trustee corporation (for example Public Trust) Having more than one person appointed at the same time can be a good check and balance. However having too many attorneys appointed at the one time can cause practical difficulties in decisions being made.
Should your attorney be the same person for both?
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It’s entirely personal preference. Some people do, but some might decide that one of their children is more compassionate for personal care decisions, another more property savvy. There are no rights or wrongs, it’s who is best for the job.
I always suggest that people have a successor attorney in case their first-appointed attorney’s appointment comes to an end, which could happen if that person dies or becomes bankrupt, or loses capacity themselves, or if a family court revokes their appointment (for example if they were not acting in the attorney’s best interests). Then you’ll have a second or third in line to step up and take their place.
With a property EPA, if you have more than one attorney, you need to decide whether they have to act together all the time, or if they can act separately. If they are obliged to act jointly, and the appointment of one of them ceases, then the other cannot continue to act alone unless you’ve specifically allowed it.
What other options are there?
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In respect of property you can choose whether you wish your attorney to be able to be able to benefit themselves or other people – for example whether you want them to continue to purchase birthday and Christmas presents for certain people, or whether you wish for them to continue a gifting programme in respect of a family trust. You should consider this very carefully as this can open up the potential to be abused. At the very least it is advisable to put a limit on the amount that the attorney can benefit themselves or other people.
Another option is whether the donor wants the attorney to be able to sign a will on their behalf once they have lost capacity. If they decide no, the last will that the donor made when they had capacity cannot be changed once the attorney has lost capacity. However the attorney may wish to leave this possibility open (for example to allow for a change of circumstances) which allows the attorney to apply to the Family Court for consent to sign a a new will on their behalf. The decision as to whether this is allowed rests with the Family Court.
There are various other options and considerations that you should discuss carefully and thoroughly with the person who is preparing your EPA’s.
What happens if you become incapacitated and you don’t have an EPA?
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If something happens and you don’t have an EPA, you could, for example, have bills mounting up and no one able to access your bank account to pay them. In this situation someone needs to apply to the Family Court to become a property manager or personal care and welfare manager (or both) – and you might not end up with the person that you would have chosen. Also, it’s more costly.
What if you fall out with your attorney, or the relationship changes?
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That does happen. One common situation is when a husband and wife separate, or there’s a falling out with a child. Provided you have capacity you can update and change these documents as often as you like.
Who should you choose for the role?
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Again, it’s the best person for the job. In practice, a husband and wife often appoint each other. But you need to remember that they are going to age together, so it’s a really good idea to have a successor in place, often adult children, a sibling, or a friend.
But it really is about choosing the best person for the job, rather than keeping family happy. It is important that there is no undue influence or pressure coming from people who feel that they should be appointed as the attorney and that the donor is freely choosing the person they want.
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Poll: Is it ok to regift something that you have been given?
🎁 Holiday Gift Chat!
Do you ever regift?
What’s your take on asking for a receipt if a gift doesn’t fit?
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79.1% Yes! It's better to regift what I don't need
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20.9% No. It's the thought and effort that matters
Poll: 🗑️ Would you be keen to switch to a fortnightly rubbish collection, or do you prefer things as they are?
Aucklanders, our weekly rubbish collections are staying after councillors voted to scrap a proposed trial of fortnightly pick-ups.
We want to hear from you: would you be keen to switch to a fortnightly rubbish collection, or do you prefer things as they are?
Keen for the details? Read up about the scrapped collection trial here.
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83.4% Same!
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16.6% Would have liked to try something different
Why we need cash to stick around----Cash is king – Using notes and coins to pay for everyday goods and services is quickly becoming obsolete. When will cash disappear from our lives? And who'll miss out when it does?
Every March, the New Zealand Red Cross sends out teams of street volunteers across the country. With their white buckets and red vests, they're instantly recognisable. The idea, says philanthropy director Jasmine Edwards, is to raise awareness for Red Cross’ work and hopefully get some donations in the process. “It’s part of our largest fundraising event of the year,” she says.
But, over the past five years, the amount the street appeal brings in has been trending down. Edwards describes a combination of contributing factors: COVID, the ongoing cost-of-living crisis and a lack of cash. “We’ve seen a pretty steady decline in people carrying cash, and that’s had a big impact on our street appeals,” she says. “It’s really affected what we’re able to raise.” That, in turn, affects how much aid work the Red Cross can do.
Edwards and the teams she co-ordinates have pivoted to other fundraising methods. They’ve trialled EFTPOS, tap-and-go donation machines and even QR codes. Each has downsides, says Edwards. EFTPOS isn’t quick, and QR codes often rely on the person taking a photo and remembering to donate later. “The tap-and-go machines are quicker because you just pop your card on, but they’re quite costly. You could never afford to have one of those at every site.”
So far, the cashless options haven’t worked as well as people reaching into their pockets and grabbing a couple of notes or a handful of coins to throw into the Red Cross buckets. However, those days, it seems, are over. In 2023, Stats NZ reported just 7% of transactions were made in cash. Everyone is using alternative methods to pay for goods and services these days, from EFTPOS and apps like Afterpay to swiping their phones and watches loaded with their credit cards.
Edwards wonders how long Red Cross has got until it needs to make more changes to its street appeals. “Our volunteers have amazing conversations with people on the street,” she says. “It’s a real moment of human connection. You can’t quite replicate that with online donations.”
Cash is king – until it’s not
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Cash use is declining – rapidly. In its 2023 Cash Use Survey, the Reserve Bank of New Zealand found cash usage for everyday purchases had decreased from 95.8% in 2019 to 60.4% in 2021 and just 57.2% in 2023. The bank says 15% of New Zealanders prefer to use cash for everyday payments, but only 8% are regular or daily cash users.
Despite this decline, cash remains important, according to the Reserve Bank: it all depends on the situation. “Research establishes that New Zealanders place a high value on having access to cash,” a spokesperson told Consumer NZ. They cited short-lived personal emergencies, long-term complex personal challenges, community-level emergencies and digital payment outages as reasons for cash’s importance.
In December 2024, the Australian government announced it would mandate businesses selling essential goods and services in that country to accept cash from 2026. “For many Australians, cash is more than a payment method, it’s a lifeline,” officials said. Australians support this, with a survey by Australia’s consumer watchdog Choice showing 97% of respondents think stores shouldn’t be able to turn down cash for essentials.
But that’s not the case in New Zealand, where there are no rules to protect cash. If a business doesn’t want to accept cash, it just has to put up a sign saying so. The only rules limit how much a consumer can pay in coins. “The Reserve Bank is currently considering further changes to the law to support the cash system and ensure New Zealanders can access and use cash as desired,” the Reserve Bank spokesperson said.
How cash can help you spend less
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Tom Hartmann, the personal finance lead at New Zealand’s independent money guide Sorted, says cash can be used as an important tool for some people to make better budgetary choices. He says credit cards or apps like Afterpay removes a buffer and encourage consumers to spend more. “You go up to the till; you get what you want; you pay, wave, swipe, whatever you do ...,” he says. “It’s all pleasure because you’re getting the thing, and any pain is sort of reserved for the future, when you get the bill.”
Cash, he says, helps those who may be struggling with their budgets get their spending under control. “With cash, it’s a different experience. You’re holding cash in one hand, and you receive the goods in the other. So, your brain is processing the trade-off right in that moment – is this worth the pain of letting go of this cash for what I’m getting?”
Carrying cash, he admits, is becoming an antiquated notion. It depends on your personality. When he’s got cash, he’s more likely to spend it faster. But Hartmann recalls a conversation he recently had with his 17-year-old son, who has an entirely different attitude. “He sold something on Trade Me recently, and he wanted to be paid in cash, because he holds on to [cash] better,” Hartmann says.
How small businesses are coping
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Every Sunday, Carol Gunn opens the Grey Lynn community centre early to let in stall-holders. By 8am, the markets are humming with customers grabbing freshly-baked pastries, recently picked vegetables, hot drinks, cheese, eggs and more. Gunn has noticed more stall-holders offering EFTPOS and credit card facilities, and fewer customers taking cash.
But she also recognises the issues, saying operating EFTPOS machines can be pricey for stall-holders, especially when they’re just getting going. “At this time of the year, we get lots of NCEA students trying out business ideas as part of their course assessments – they can only use cash,” she says. “We get community fundraisers who can only use cash. Getting rid of cash could disenfranchise the grass-roots activities in society.”
Frank Argent, the owner of Barefoot Gardens, a small produce farm in Kumeu, Auckland, agreed. While bagging up my potatoes and chillis recently, he told me about 40% of his customers paid in cash, which he encouraged. Why? “Every time you swipe your card, the bank takes a sizable chunk,” he said. “For a small business like ours, it adds up to a reasonable amount over a week.”
Other factors to consider in the death of cash
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There are still many elderly people who cannot use, or forget how to use, tech. Cash, therefore, remains very important to them for everyday items like groceries. “A cashless society makes things very difficult for older [generations],” one financial advisor told me.
Natural disasters or emergencies can affect internet networks, shutting down EFTPOS and credit capabilities. “Cash is often the only option at that time,” an advisor said. “Everyone should have a small amount of cash put aside.” How much is a personal decision, but the National Emergency Management Agency suggests it’s logical to have enough for three days’ worth of food and petrol. It also says small denominations, like $5 notes, are useful because some businesses may not be able to offer change.
Putting coins into a piggy bank is often a child’s first interaction with money. An advisor said the process can teach children important financial basics about saving money from an early age.
The king is dead; long live the king!
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Claire Matthews, an associate professor at Massey University’s business school, says it’s too soon to say we’re on the brink of becoming a cashless society. “We have already moved a long way towards it, but I think cash transactions will be difficult to eliminate,” she says. “I think probably most of us are ready to move to a cashless society. But there are a few who aren’t and will likely find it very hard.”
But my own experiences suggest the shift could be happening faster than anyone thinks. While researching this piece, I found a sign at my local Pak’nSave declaring the store’s self-service check-outs would soon stop accepting cash. “Cashless,” warned a printed sign in red.
Then, at a recent Auckland Football Club match, I approached a cashier while balancing drinks and hot chips. When I handed her a $50 note, she turned it away, saying, presciently, “We don’t accept cash here”. I smiled and waved my phone over the terminal. That $50 will have to wait for another day.
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