Wills, Trusts, and Powers of Attorney Explained
Photo source: openverse, Matthias Zomer
Planning for the future can feel daunting, but understanding wills, trusts and enduring powers of attorney gives you peace of mind and protects the people you love. This plain English guide explains the basics for New Zealand seniors.
What is a will?
A will sets out who receives your property after you die and names an executor, the person who carries out your wishes. In New Zealand, a will must be in writing, signed by you and witnessed by two people who are not beneficiaries. Without a valid will, your estate is divided under the law, which may not match your wishes. Marriage or a civil union can cancel an earlier will, so review yours after any major life change. Keep the original somewhere safe and tell your executor where it is.
What is a trust?
A trust is an arrangement where trustees hold and manage assets for the benefit of others, called beneficiaries. Many Kiwi families use a family trust to hold the home or savings, keep assets together or provide for grandchildren. Trusts are governed by the Trusts Act 2019 and carry ongoing responsibilities, so seek legal advice to see whether one suits you.
What is an enduring power of attorney?
An enduring power of attorney, often shortened to EPA, lets you choose someone you trust to make decisions if you can no longer make them yourself. There are two types. An EPA for property covers money matters such as paying bills and managing accounts. An EPA for personal care and welfare covers health and living arrangements, and it only starts when you lose capacity. A lawyer or authorised person must explain and witness the document. Without an EPA, your family may need to apply to the Family Court, which takes time and money.
Why act sooner rather than later?
You can only make these documents while you have the mental capacity to understand them, so earlier is better. Choose people you trust, talk with them about your wishes, keep your documents in a safe place and review them every few years. Putting these in place now spares your family stress and uncertainty at a difficult time.
Where to get help
Speak with a New Zealand lawyer about your situation. Free or low-cost help may be available through Age Concern, Community Law Centres and Citizens Advice Bureau.
