In the UAE’s legal landscape, it is important to understand the various documents that can protect you and your loved ones. Two of the most important legal instruments are power of attorney and wills. While both serve to safeguard your interests, they function quite differently. You will read about the difference between a will and power of attorney in this blog.

A Will: Your last say

A will is a legal document that outlines your wishes to distribute your assets after your death. It’s your final opportunity to have a say in what happens to your properties, possessions, and even the care of your minor children. Key components of a will typically include naming an executor to manage your estate, designating beneficiaries to receive your assets, specifying how and when assets should be distributed, and naming guardians for minor children. For a will to be legally valid, it must meet certain requirements, which can vary by jurisdiction. Generally, these include being of legal age and sound mind when creating the will, signing the document in the presence of witnesses, and having the witnesses sign the will.

A Power of Attorney: Your Living Voice

A power of attorney (POA) is a legal document that allows you to appoint someone to act on your behalf in financial or legal matters while you’re still alive. This person, known as your “attorney-in-fact” or “agent,” can decide if you become incapacitated or simply need assistance managing your affairs. There are several types of power of attorney – general Power of Attorney (Broad authority over financial and legal matters), limited Power of Attorney (Authority restricted to specific tasks or periods), Durable Power of Attorney (Remains in effect if you become incapacitated) and Medical Power of Attorney (Allows someone to make healthcare decisions on your behalf). To create a valid power of attorney, you must be of sound mind when creating the document, clearly identify your chosen agent, specify the powers you’re granting, sign the document, and have it notarized, depending on your jurisdiction.

Difference Between Will And Power Of Attorney

Both wills and powers of attorney are important legal tools but they differ in several crucial aspects. They are as follows:

• While a will is concerned with asset distribution after death, PoA primarily focuses on managing affairs when the principal is alive.
• A major difference between a will and power of attorney is that a will is effective only after your death and a PoA will be effective immediately or on a specific date mentioned in the PoA.
• A will is a permanent document unless it’s revoked or modified while a PoA ends at the death of the principal or can be limited to a specific time frame.
• Both a will and a PoA can be changed and revoked at any time when you’re of sound mind.
• When it comes to decision-making power, an executor will make decisions after your death based on your instructions in the will, and in the case of a PoA, the agent can make decisions as long as it is within the scope of the agreement.

Power of Attorney vs will: When to use them?

The choice between a will and a power of attorney isn’t an either/or decision – most people benefit from having both. However, understanding when each is most appropriate can help you plan more effectively:

Use a will when you want to:

• Ensure your assets are distributed according to your wishes after death.
• Name guardians for minor children.
• Make gifts or donations from your estate.

Use a power of attorney when you need:

• Someone to manage your financial affairs if you’re unable to do so.
• A trusted person to make healthcare decisions if you’re incapacitated.
• Assistance with legal or financial matters while you’re away or otherwise occupied

Conclusion

In conclusion, PoA and wills are complementary legal safeguards. Understanding the differences between a will and power of attorney is necessary for comprehensive estate planning. While a will serves as your voice after death, a power of attorney acts as your representative in life. By utilizing both documents effectively, you can ensure that your wishes are respected and your affairs are managed according to your preferences, both during your lifetime and after you’re gone.

Frequently asked questions

1. Can the same person be both my power of attorney and the executor of my will? 

Yes, it’s possible and often common for the same trusted individual to serve both roles.

2. Can I have multiple powers of attorney?

Yes, you can have different powers of attorney for various aspects of your life, such as financial and medical decisions.

3. Do I need a lawyer to create a will or power of attorney? 

While it’s possible to create these documents yourself, consulting with a legal professional can ensure they’re properly drafted and legally binding.

4. What happens if I die without a will? 

If you die without a will, your estate will be distributed according to your state’s intestacy laws, which may not align with your wishes.