In estate planning, the durable power of attorney is extremely important for a number of reasons. It allows you to decide who will step up to the plate and carry out your financial decisions and affairs should you become incapacitated. Needless to say, when deciding who to appoint as a Power of Attorney, it’s a powerful role you’re filling and your decision is one that shouldn’t be made lightly. As estate planning attorneys, we always encourage our clients to give this decision a great deal of thought.
And if I Don’t Have a Durable Power of Attorney?
This is the question we’re always asked when we explain how important it is for estate planning purposes. The answer is simple: if you don’t have one in place, the court appoints a guardian or conservator to oversee the affairs. And guess what? The court may appoint the last person you’d ever expect. That alone is enough to convince clients that they should indeed be the one to make that decision today versus gambling on a judge making the wrong decision tomorrow.
Not only that, but if you become incapacitated and the process begins for the courts to decide, it’s going to cost both time and money – two things your family may not have a lot of if they’re trying to care for your needs.
Further, when you name your choice, that person can move forward with overseeing your estate; however, if a judge names someone, that person may require take every decision to the court prior to anything happening. That may prove dangerous in a number of ways and most certainly, inconvenient in most ways.
A Springing Power of Attorney
A springing power of attorney is one that has a clause that the named person won’t be able to act until or unless it becomes necessary. It differs in that it has that stipulation. Of course, no durable power of attorney is used until it’s necessary, but with the springing clause, there are definitive guidelines that determine or redefine “incapacitated”. With a Springing POA, these guidelines will have to be met before a POA can be used and may include requiring your incapacity to be certified before doctors. This can defeat the whole purpose.
One of the biggest fears clients have is what happens if they appoint someone and then that person drops the ball or goes against everything they promised to uphold? The truth is, it’s always a tough call and yes, there exists the possibility of that scenario playing out. This person, known as your “attorney-in-fact”, will have a huge trust placed on their shoulders, but it also doesn’t take away your rights. It’s important, though, to choose carefully.
Other clients say there’s no one in their lives whom they trust with that kind of responsibility. In those instances, you may wish to allow the court to name someone. As mentioned, those court appointed overseers may have to get permission from the court in every decision they make. That might be a better option for you.
Remember, your first best move is finding an attorney who specializes in financial planning, estate planning and will preparation. From there, you can move forward knowing you’re receiving solid legal advice.
- Important Questions Related to Incapacity Planning - October 8, 2021
- Here’s What an Estate Planning Attorney Can Do For You - October 5, 2021
- Organizing Your Online Affairs - September 22, 2021