Durable Power of Attorney for Finances
A Durable Power of Attorney for Finances is a legal document where you appoint someone else to manage your financial and business affairs. This document is a very powerful document because it allows the person that you appoint (called your “attorney-in-fact”) to have access to your financial resources should you need assistance. Choosing a financial power of attorney is an important decision that you should not take lightly. However, it is also a very important document for every adult to have because if you become incapacitated, the document will allow your trusted person that you appoint to help you bay your bills, access your bank accounts, and manage your business affairs.
Who should I name as my Financial Power of Attorney? Who you choose to help assist you with your financial and business affairs is a very important decision. No matter who it is, that person should always be someone you trust explicitly. It does not have to be a family member, and sometimes, a family member may not be the best choice for you. You should look to name a person who is trustworthy and upstanding, and who would never take advantage of you under any circumstance. While there are laws that protect you if your financial power of attorney abuses the power you have granted, it may be too late to recover your assets if they have already spent your money or skipped town. It is important to consult with an attorney to help you better protect yourself from potential abuses.
When does the Durable Power of Attorney for Finances become effective? It depends. You can choose to have it become effective immediately, which is often the recommended course so that your attorney-in-fact can act on your behalf quickly and easily. However, for some people, they may choose to have it become effective on the happening of a particular event, like the signature of two doctors who have declared that you are incapacitated (also known as a “springing” power of attorney).
What kinds of business and financial actions can my attorney-in-fact make? This also depends on your particularized needs. Financial powers of attorney can and should be customized to your own situation. Do you on real estate that may need to be managed? Do you have bank or retirement accounts that may need to be accessed if you are in the hospital? Do you need to do long-term care or Medicaid planning in the foreseeable future? These are just a few of the considerations one of our attorneys can assist you with.
Can I use a preprinted form? Yes, you can if the proper legal requirements are met. But why would you? Durable Powers of Attorney are not expensive even when consulting with an attorney—but they are extremely powerful documents that should be drafted carefully and customized to your needs. Affordable but thorough and effective powers of attorney should be drafted by an experienced attorney who is knowledgeable about the many, many pitfalls that can happen if you use a pre-printed form or do not have a Power of Attorney at all.
Who should have one? Every person who is over the age of 18, not already incapacitated, and has financial or business affairs that may need to be managed in the event of an accident, illness, or some other event that may cause an incapacity, even if on a temporary basis.