South Africa is facing a silent crisis. As dementia, Alzheimer’s and stroke-related cognitive decline rise sharply, many families are discovering—often in the middle of a crisis—that they are not financially equipped to support a loved one who can no longer manage their own affairs.
This would be challenging in any country. But in South Africa, the problem is amplified by a widespread misconception: that a Power of Attorney (POA) will continue working when mental capacity is lost. It doesn’t. And this misunderstanding leaves families exposed at the very moment they need support.
What a Power of Attorney Can, and Cannot, Do
A POA falls under the law of agency. It allows a principal to grant an agent authority to perform specific legal acts on their behalf. The key principle is simple but crucial:
An agent cannot do anything the principal would not be legally capable of doing themselves.
This means a POA—whether general or specific—only works while the principal still has full mental capacity. It automatically terminates upon insolvency, death, or any loss of mental capacity. Banks and institutions have become increasingly strict about this, often rejecting POAs the moment there is doubt about capacity.
So, while POAs are extremely useful for travel, temporary incapacity, emigration, or convenience, they offer no protection at all once cognitive decline sets in.
The Legal Gap: No Enduring POA in South Africa
Many developed countries have “enduring” or “lasting” powers of attorney that continue to operate after incapacity. South Africa drafted similar legislation years ago, but it was never enacted. Until that changes, the only options when capacity is lost are:
Curatorship – a High Court application, slow, costly, and emotionally draining.
Administration – a limited option for smaller estates, via the Master of the High Court.
Both can take months, even years. Meanwhile, access to bank accounts and assets is effectively frozen—even when funds are urgently needed for care.
Your Practical Options Today
While our legal framework is outdated, families still have ways to prepare:
Use joint accounts or dual signatories for essential transactions.
Consider co-ownership of key assets.
Explore an inter vivos trust, which continues operating even if a trustee becomes incapacitated.
Act early—long before cognitive decline is suspected.
Work with a financial planner who can guide the family through the complexities.
Cognitive decline often arrives suddenly. The financial consequences do, too. A thoughtful plan, built while capacity is still intact, is one of the greatest gifts you can give your family.
If this topic touches your situation, let’s talk. Early preparation brings clarity, dignity, and peace of mind when it’s needed most.
Dirk Groeneveld, Certified Financial Planner
t. 083 261 9287
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