Power of Attorney
What is a Power of Attorney?
A Power of Attorney designates an attorney-in-fact (agent) to act and
to make financial decisions on your behalf. A person can legally assign
responsibility to a trusted representative to handle financial transactions
for them.
When is a Power of Attorney Needed?
A Power of Attorney becomes very important upon incapacity, i.e. the
loss of the ability to act alone or independently. A Power of Attorney
is a crucial instrument to execute while one has the capacity to execute
one so as to ensure the fiduciary of your choice.
A Power of Attorney can enable access to your accounts and
assets in the event of an emergency or incapacity. Most importantly,
in most cases it can help avoid the need for a Guardianship
proceeding which usually is costly and time-consuming.
Immediate or Springing?
A Durable Power of Attorney takes effect immediately upon execution.
Alternately, a Springing Power of Attorney does not take
effect upon execution but only takes effect in case of your
incapacity or disability. Upon incapacity or disability, it
"springs" into effect. A physician's signature is
required before it becomes effective.
Who should I assign as my agent?
A Power of Attorney is a powerful document, therefore it is extremely
important to choose a representative that you trust who will act only
in your best interests.
Most people appoint a close family member or personal advisor such as
a financial planner, CPA, or attorney.
Who Should Have a Power of Attorney?
We recommend all of our clients execute Durable Powers of Attorney, as
they make managing your resources easier should you ever lose the ability
to manage your own affairs.
It is important to note, however, that there are advantages and disadvantages
to either type of Power of Attorney. Before you execute a Power of Attorney,
you should consult with someone experienced in this area such as a financial
advisor or attorney.
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