You have worked hard to grow and nurture your assets throughout your lifetime. What happens if, due to illness, hardship, or other difficulty, you are unable to continue to do so? A Durable Power of Attorney answers this question.
A Durable Power of Attorney authorizes your named agent, called an attorney-in-fact, to handle your finances. This could include paying your bills while you are in the hospital recovering from surgery, signing your income tax returns, signing health insurance documentation on your behalf, and making gifts to your family or charitable donations.
Here are some other things you should know about Durable Powers of Attorney:
- Without a Durable Power of Attorney, if you are incapacitated and someone needs to pay your bills for you, that person may have to petition the court for a conservatorship. A conservatorship will cost time and money that you may not have to spare.
- A Durable Power of Attorney states that it will remain in force and effect even after you become incompetent. A general Power of Attorney, without such a statement, will actually cease to be effective if you become incompetent. All Powers of Attorney end upon your death.
- Powers of Attorney can be written to become effective upon your incapacity. This is known as a Springing Power of Attorney. Oftentimes, though, it can be advantageous to give the attorney-in-fact authority to act for you immediately after you sign the document.
- Most often, Durable Powers of Attorney give the attorney-in-fact authority over all financial accounts, but they can also be drafted to give limited access to specific accounts only.
- Always be sure to give your bank or financial institution an original signed Durable Power of Attorney to scan and return the original to you for future use. Most banks will not accept a copy.
- Update your Durable Power of Attorney periodically. Banks often refuse to accept Durable Powers of Attorney – even though they are still valid – if they are considered “old” or “stale.”
If you are interested in discussing Durable Powers of Attorney in greater detail, please contact me at 508-929-1620 or email@example.com.