Navigating the intricacies of your financial legacy can be a daunting task. Understanding the nuances…
You might nominate both of your children as attorneys-in-fact, requiring that they agree to act on your behalf under a power of attorney.
Fed Week’s article, “Giving Someone the Power of Attorney,” uses the example that you might suffer a stroke with no prior warning signals and be unable to sign your name. This could mean serious financial consequences. However, executing a power of attorney can protect you in that kind of situation.
It’s important for just about everyone to have a power of attorney. You can name more than one attorney-in-fact, stipulating if they are permitted to act alone or if they must act in concert.
Of course, the individual you designate must be someone you trust. This is typically a close (albeit younger) member of the family or a close friend.
If desired, you can assign different responsibilities to different individuals. For instance, you can name your spouse to make your housing decisions and your son to manage all your financial affairs.
You may not want to give power over your assets to a family member, while you’re still in command of your faculties (or have capacity). To address this, many states recognize springing powers of attorney. These do not become effective, until specified events take place, like incompetency (certified by a doctor) or when you go into a nursing home.
If your state doesn’t recognize springing powers, you often can see the same result with a durable power of attorney that’s accompanied by a letter saying that the power will go into effect, if certain events occur. For example, in Florida, contingent or “springing” powers are not permitted after legislation was passed in 2011. However, the State of Minnesota does recognize them.
Talk to an experienced estate planning attorney. He or she can also keep these signed documents until they’re needed.
Your attorney will also know if the law also provides that powers of attorney properly executed under the laws of another state are recognized in your state of residence.
Reference: Fed Week (October 3, 2019) “Giving Someone the Power of Attorney”