If you do not have a power of attorney (POA), this blog is for you! A POA is a written document authorizing another person to act on your behalf in business and/or personal matters. It is important for you to take action to get a POA to help ensure you and your finances are protected if something should happen to you.
Nobody knows what their future holds, so creating a POA while you are able to do so is essential. You can appoint a trusted individual to act as your agent or attorney in fact, which means they can make personal and/or financial decisions on your behalf if you become unable to do so for yourself.
If it makes you nervous to consider granting this type of authority to another person, you should understand that a POA has a fiduciary obligation to you. In other words, the law requires your POA to act in your best interests and in accordance with your wishes at all times. Your POA can be a family member, trusted friend, or even a third-party such as a lawyer or a bank.
The two main types of powers of attorney for estate planning purposes are:
- Springing power of attorney. This type of POA is called a “springing” POA because it is only effective if certain conditions (set by you in your POA document) occur. The most common condition used to activate a springing POA is that you become incapacitated or otherwise unable to properly manage your own affairs. The POA does not have any authority to act on your behalf until a physician or a court determines that you are not capable of handling your own affairs and financial decisions.
- Durable power of attorney. A durable power attorney transfers authority to the appointed POA immediately and your agent does not need to prove your incapacity.
To learn more about powers of attorney and why you need one, please contact our office to schedule an initial consultation.
Whether you have a will or a trust or nothing at all, we, at The Law Office of Diane Anderson, can help you navigate probate and trust termination. This may include assets, debt, tax debt, guardianships and more. Contact us today to schedule a comprehensive consultation.