Roughly 1 in 3 adults will develop some level of dementia during their lifetime. Nearly 1 in 9 adults 65 and older will develop Alzheimer’s disease. Along with other health issues and accidents, it simply makes sense to proactively designate someone as your agent in the event of incapacity.
A Financial Power of Attorney can provide the peace of mind that their fiances will be managed according to their wishes by someone they trust. It could also save time by avoiding a probate court’s permission to handle their personal affairs.
A Financial Power of Attorney is when the primary person, the principal, grants management of their financial affairs to another person, known as the agent or attorney-in-fact. The powers granted to the principal must be set forth in the power of attorney document. The agent has a fiduciary duty to act in the best interests of the principal. The agent’s duties typically include managing various investment and banking activities, managing property, and paying bills.
A Power of Attorney can be activated in several different ways. Some are active immediately upon signing. Others are only active upon incapacity. Both have advantages and disadvantages that should be discussed in detail with your attorney to determine which one is best for your situation.
Although Powers of Attorney come in all types and can be easily customized, they all expire upon the death of the principal. For this reason, a Power of Attorney works best when included as part of a comprehensive estate plan. An attorney should be used to determine exactly what that comprehensive estate plan needs to include and take care of.