Creating an estate plan requires thinking about several aspects of your life. While many people focus on assets and how to pass those down to their loved ones, they also need to consider what will happen if they become incapacitated.
If you’re incapacitated, you’ll need someone to make decisions for you. This includes making decisions about your finances, so you’ll need to give someone power of attorney over your finances in the event that you cannot manage them as a result of your incapacitation.
Duties are clearly defined
The duties of a financial power of attorney are clearly defined. They can do anything that you could do when it comes to money matters, unless you restrict their authority in specific ways. This includes buying and selling assets, as well as paying bills.
Decisions must be made appropriately
The person you name as the financial power of attorney must be able to make decisions appropriately. They must consider your needs and wishes instead of thinking about ways they can benefit from the decisions they’re making.
Powers end when death occurs
A financial power of attorney ends as soon as you pass away. At that point, your personal representative takes over the financial matters, including paying the bills for your estate.
Having a comprehensive estate plan in place is critical for all adults. Choosing someone you trust to handle your finances when you can’t help to protect the assets you’re going to hand down to your loved ones after you pass away is an important part of this planning. Seeking legal guidance may help to make the planning easier.