A power of attorney for an incapacitated person is a legal document which gives another adult the durable legal right to act on your behalf. It is essential that you have a power of attorney that is durable and will allow another person to administer your final decisions; without one your financial affairs may go into disarray.
The most important factor when establishing a power of attorney document is determining who will actually be given the right to handle your affairs. You should think deliberately about this topic; it may not be the person who first comes to mind.
If your estate is not properly administered and your debts are not resolved prior to death, the probate process could put your family under the microscope of your community, since all probate proceedings are public.
Family Money Implications
A power of attorney protects your children and grandchildren by ensuring that your final estate plans will be administered despite your physical inability to sign final trust documents.
There are many common misconceptions about wills and estates. The most common is that a person can take care of such matters later in life. The problem with this is that we never know when a bad accident will occur. Another misconception is that only wealthy people need a strong estate plan.
You will need to contact an attorney to properly establish a power of attorney document. It should not be a very expensive document for the attorney to write, as most power of attorneys are only a few short pages.
A power of attorney document will ensure that your estate does not go out of your family's financial circle and into the hands of another party like the Internal Revenue Service.
- "Kiplinger's Estate Planning"; John Ventura; 2008