Bentonville Estate Planning: Why do I Need a Power of Attorney?
What is a Power of Attorney?
A power of attorney is a legal document in which you name somebody else (agent or attorney-in-fact) to manage your legal and financial affairs for you. You can limit the power or make it unlimited. You can also set a time limit or other conditions which make the power of attorney inactive.
Your Last Will and Testament is not a power of attorney or a substitute for a power of attorney!
Why a Power of Attorney?
Military Deployment
Before deploying for military service, you will want to sign a power of attorney so your family or spouse can take care of your local financial and legal affairs. Without this, your family may not be able to do simple things like renew your care insurance.
Travel
If you travel frequently for your work, you will want a power of attorney for the same reasons as somebody on active military deployment. Your spouse or family should be able to handle your local affairs.
Preventative
You should have a power of attorney on file in case of sudden mental incapacity. This isn’t the same as dementia. This would be in the case of an accident or healthcare incident like a stroke or heart attack. You can setup a power of attorney so that it is only active after your incapacity, not before.
When is it Too Late?
- If a doctor, court, or other professional has declared you incompetent to make your own decisions
- If you are unconscious due to accident or medical incident. Your family can’t sign for you. In this case they would have to go to court to seek a guardianship.
- If the attorney determines that you are not in a state of mind to sign. Part of an attorney’s job is to make a determination if you are mentally competent to sign.