Most people realize the importance of the last will and testament. However, they remain unaware of the importance of a durable power of attorney.
In times of unforeseen circumstances or incapacity, a power of attorney serves as a crucial legal document that grants authority to another individual or financial institution to act on your behalf. This authorized person, known as an agent, is entrusted with the responsibility of executing specific financial transactions that you may be unable to handle. These transactions can range from paying bills and managing insurance claims to selling real estate and filing tax returns.
The general durable POA is used when a person is unable to act for themselves due to illness, injury, or cognitive decline. The POA is also used for when someone prefers to have another person manage their financial affairs.
For instance, you may authorize the agent to make gifts on your behalf, complete and sign tax returns, exercise stock options, or initiate legal action against a third party.
Spouses (or whoever your agent is) typically use POAs to handle day-to-day financial tasks, from dealing with insurance companies to managing bank accounts, loans, or other financial matters. If one spouse cannot attend a real estate closing, for example, the other will need a POA so they may represent their spouse.
POAs are state-specific documents, so any POA, whether for healthcare or finances, should be created by an estate planning attorney in the state where you live and any state where you own property.
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Drafted by an experienced estate planning attorney to suit the specific needs of the individual, a power of attorney can make it possible for a trusted individual to conduct your wishes and protect your best interests. Make sure that you have one and update it whenever you update your overall estate plan.
Are you ready to put a power of attorney in place? Book a Call with us today.
