You work a lifetime building your nest egg, so the thought of losing financial control can be difficult at any point in life. However, having a trusted document like a power of attorney (POA) can bring you and your loved ones peace of mind. Contrary to what some believe, the reality is that your POA does not own your money or property, and they cannot change your will, make a will, or change a beneficiary on an insurance plan. Your POA is there to learn about your life events, needs, or concerns and help make financial or medical decisions on your behalf if you are unable to.
This is a decision that requires careful consideration, and like any financial tool, there are pros and cons:
- The document makes it clear who is responsible for your money and property, even temporarily, if you need help managing them. Your attorney must manage your money and property responsibly and for your benefit. If questioned, they may be required by law to account for their actions.
- The document can be as flexible or time-sensitive as you would like or as general or specific as you need.
- You can appoint multiple attorneys and request they make decisions in unison or highlight that they can act separately if one attorney is unavailable. You can also appoint an alternate or successive attorney. This may help reduce the chance of fraudulent activity.
- There is a risk that if the wrong attorney is designated, you can become vulnerable to financial abuse. It can happen where an attorney makes decisions based on their best interest rather than the interests of the estate they manage.
- If your document lacks clarity, there is a risk that your finances could be managed in ways you do not simply agree with.
- If multiple attorneys are appointed, disagreements could cause problems or delays in managing financial affairs.
You should always seek independent legal advice to ensure your needs and expectations are clear. Appointing a POA is dynamic; it can be changed or revoked at any time. Contact me for more details.