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Financial power of attorney: why you need one

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What is a financial power of attorney?

 A financial power of attorney is a legal document that designates someone to handle your financial decisions on your behalf.

 

What happens if I don’t have a financial power of attorney?

If you do not have a power of attorney and you were to become incapacitated, any financial decisions would need to be made by a court-appointed conservator. At a court’s direction, the conservator would handle your financial assets. It’s a quite expensive and time consuming process, especially compared to the relative simplicity of executing a power of attorney.

 

After I die, can my agent continue to operate under my financial power of attorney?

A common misperception is that your agent will be able to use this power after your death. At your death, any power of the agent is automatically revoked and it will be necessary to switch management to the representative appointed through probate.

 

Who should I choose to serve as an agent?

The agent you choose will be managing your finances, so it is critically important to choose someone trustworthy; someone who will not abuse or exploit this power; someone who will listen to your wishes, goals, and objectives, as included in the document or otherwise communicated; and someone who will look out for your best interests.

 

You also have the option of designating a successor agent who can take over if the original agent is unable or unwilling to serve. This is highly recommended.

 

Who should receive a copy of my financial power of attorney?

The person named as agent and any person named as a successor agent should receive a copy. It would also be wise to share a copy with your financial institution(s), such as your bank or credit union.

 

Can I revoke the financial power of attorney?

Yes, you may revoke the document, at any time. You can also amend the document (change it, revise it, etc.) at anytime.

 

Do you have a financial power of attorney? Why or why not? Please share your thoughts with me.