Posted on: May 20, 2015
Life is full of the unexpected. As we get older it may seem that unexpected events become more common, but we can anticipate and plan ahead for the help we may need. Every adult should have a Durable Power of Attorney for Financial Affairs. In this document you name a person called your “Attorney-in-Fact” (AIF) to manage your financial affairs. You also name alternates to your AIF in case, at the time of need, the AIF you name is unwilling or unable to serve.
You should choose a trustworthy person to act on your behalf should you become unable to do so because of injury or illness, or simply because you want help with managing your affairs. The “durable” nature of the document means that it will remain in effect should you become incapacitated. This does not mean you lose control over your financial affairs as long as you are capable of making financial decisions. It means that someone you trust will step in and manage your finances and make decisions as you would at your time of need.
We generally recommend to our clients that the Durable Power of Attorney be effective immediately. The alternative is “springing,” effective only after certain conditions are met, typically when you become disabled or mentally incapacitated. This delays the ability of your AIF to step in and provide assistance you need. Your Durable Power of Attorney avoids an unnecessary court Guardianship for you should you become incapacitated. Guardianship is a time-consuming, public and expensive process and it is easy to avoid with the right document in place.
The Durable Power of Attorney should list the exact powers your AIF will have to act in your stead, so it should be tailored to your wishes and needs. Your AIF will have legal authority to accept your income and make payments to your creditors, file your taxes, pay your caregivers, invest your assets or sell them if necessary to meet your financial obligations, gift your assets, and more. You can give these powers, limit them, or specifically forbid them in your Durable Power of Attorney.
A skilled Elder Law attorney can help you protect your financial interests by crafting a Durable Power of Attorney unique to your needs and wishes. Your attorney can help you understand what events you may need to anticipate and to choose someone who you trust implicitly and who has the skills to manage your affairs. Your attorney can then draft a custom Durable Power of Attorney that accurately reflects your wishes and needs and grants legal authority to your AIF should the unexpected happen. Please call us at (509) 468-0551 for more information about this and other documents that should be part of your estate plan.