Should I have a Power of Attorney?

As you know, anything can happen to us in the blink of an eye. When an emergency happens, some of the details can get ignored. A power of attorney is an important piece of any estate plan. In the event you are no longer able to take care of your finances, you should have someone around who is able to pay your bills, operate your business, makes decisions regarding gifts, and sign new or ongoing contracts. Without a power of attorney or some other type of incapacity planning in place, someone may have to institute a guardianship or conservatorship over you. Guardianships and conservatorships both require Court oversight. This means that you will lose privacy and may incur fiduciary and attorneys fees that could have been avoided.

​For something as minor as being out of the country, or as complex as losing mental capacity, The person or organization you appoint as your attorney-in-fact will have authority as broad or limited as is stated in the power of attorney document. Depending on your circumstances, a power of attorney should be tailored to your needs and circumstances. What many people do not realize however, is that a power of attorney must be prepared while you still have the mental competency to do so. This means you cannot wait until you have been determined to have lost capacity and then try to execute a power of attorney document; although sometimes people try.

Some people try to solve this problem by executing power of attorney documents that claim not to take effect until some point in the future, like if they become incapacitated later on. This may or may not be a good idea. It may be difficult to prove mental capacity or incapacity or you may change your mind about who should have a power of attorney over you. I always ask my clients, “If you do not trust someone to be your attorney-in-fact when you are fully mentally competent, why would you trust them when you are not?” Since giving someone a power of attorney over you carries with it a risk of abuse, choosing a proper candidate for that power is an important choice that should be discussed with an experienced lawyer.

Please contact our office if you would like to know more about Powers of Attorney documents.