A Durable Power of Attorney is a legal document through which you grant authority to a trusted individual to act on your behalf. It does not take away your authority to act. And it can be revoked at any time (as long as you have the capacity to do so).
Durable Powers of Attorney for financial matters and health care can be separate documents or a combined document. It is “durable” because it remains in effect even should you lose capacity.
Who Would You Want Taking Care of Your Financial Matter if You Could Not?
A Durable Power of Attorney is a legal document through which you grant authority to a trusted individual to act on your behalf. It does not take away your authority to act. And it can be revoked at any time (as long as you have the capacity to do so). Durable Powers of Attorney for financial matters and health care can be separate documents or a combined document. It is “durable” because it remains in effect even should you lose capacity.
The person appointed under your Durable Power of Attorney is known as an “Attorney-in-Fact,” “POA,” “Agent”, or for health decisions, a “Health Care Agent.”
Without an effective Durable Power of Attorney, if you were unable to manage your affairs due to incapacity or other reasons, the state in which you live would require a court-appointed Guardian to manage your finances and direct your care with expenses to be paid from your assets. The Guardian may be a family member, or could be a stranger you have never met!
A good Durable Power of Attorney, on the other hand, not only lets you appoint who you trust to handle your affairs, a well-drafted Durable Power of Attorney authorizes your decision-maker to take steps to protect assets for you, especially important if Long-Term Care needs arise.
What Is an Attorney-In-Fact?
The person appointed under your Durable Power of Attorney for finances is known as an “Attorney-in-Fact” or “POA.”
The Attorney-in-Fact is someone specifically named through the Durable Power of Attorney document to act and conduct business on your behalf. That authorization includes signing documents, transacting business, paying bills, accessing your bank accounts, and if the document includes specific powers important to Elder Law planning, it should include authority to enter into Long-Term Care planning to protect your assets.
Because the Attorney-in-Fact has the authority to handle your financial decisions if you cannot, this person should be someone you trust implicitly to follow your wishes and look out for your best interests. You should talk with the person you want to name as your Attorney-in-Fact to ensure he or she understands your wishes concerning financial decisions.