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The different types of powers of attorney

Written and accurate as at: Oct 19, 2020 Current Stats & Facts

For some of us, in terms of estate planning and the management of our affairs, our main focus can often be on drafting a will—and putting arrangements in place for assets (e.g. super) that may not be covered by our will.

These matters primarily centre on how we would like our affairs managed in the event of our passing. Importantly, thought should also be given to the management of our affairs while we are still alive.

With this in mind, below is a brief overview of powers of attorney, and the different types that may be available and their benefits.

Please note: Laws governing powers of attorney may vary in each state and territory. Please consider seeking professional advice to better understand how they may relate to your personal circumstances.


Powers of attorney


In broad terms, a power of attorney is a legal document that gives authority for someone or a number of people (the attorney/s) that you (the donor or principal) appoint to act on your behalf regarding the management of your affairs.

To make a power of attorney, you must have mental capacity—meaning you’re deemed capable of understanding the nature, significance and effect of making a power of attorney when you sign the legal document.

Appointing an attorney can be beneficial in the event you find yourself unable to manage your affairs, for whatever reason, either now or in the future. For example, if you suffer ill health, become confined to hospital, travel overseas, or are unable to attend a financial institution or real estate agency, or government office.

An attorney can be a family member or a friend or someone else that you trust. However, in general, they must:

This authority generally centres on financial matters (including related legal matters) and may include, for example, buying/selling shares, managing an investment property or operating a bank account.

As an example, a recent report* estimates that in Australia there are several hundred thousand bank accounts being operated under a substitute decision-making arrangement, such as a power of attorney.


When it comes to powers of attorney, the two main types are:

1. A general power of attorney, which gives authority for someone to act on your behalf on financial matters, either broad or more specific (e.g. only managing your investment property or making all of your financial decisions for the time you're on holidays). This type of authority may commence as soon as it’s signed by you and accepted by the person you appoint as your attorney—alternatively you may wish to state when you would like this type of authority to commence.

Furthermore, this type of authority remains valid until one of the following occurs: it reaches its expiration date, it’s revoked by you, it’s cancelled or suspended by a relevant court or tribunal, you pass away or you lose your decision-making capacity.

2. An enduring power of attorney is similar to a general power of attorney, however, this type of authority continues even if you lose your decision-making capacity. This type of authority may be of great assistance, should you lose the capacity to manage your affairs through illness, accident or advancing age. Please note: A medical power of attorney may also be possible—depending on your state or territory—and gives authority for someone to act on your behalf on medical matters. This can often be included in an enduring guardianship or enduring power of attorney.


  • It’s important to understand that giving someone the authority to act on your behalf is a serious decision. They should be someone that you trust will act in your best interests—and they should have the capacity and ability to make the required decisions should the event arise.
  • It’s important to consider making a power of attorney before you need it. This can be particularly true when it comes to an enduring power of attorney. As previously mentioned above, once you have lost mental capacity, you can’t make a power of attorney.
  • It’s important to consider having a conversation with those you wish to appoint—as well as seek the advice of an estate planning professional to understand your options, the possible outcomes of your decisions, and make sure they align with your goals and objectives.


After reading this article, you may also find the following of interest:

If you have any questions regarding this article, please contact us.

*Australian Government, Attorney-General’s Department. (2020). Enhancing protections relating to the use of Enduring Power of Attorney instruments. Consultation Regulation Impact Statement February 2020.


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