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A Journey Into Estate Planning: The Power of Attorney

May 24, 2017

(First read the introduction post and find links to the other Journey Into Estate Planning posts).

The Power of Attorney or POA is a document that handles property (real and personal) and finances.  It is an incredibly powerful document that goes into effect immediately upon signing the document and is valid until you revoke it or your death – whichever comes sooner.  The POA names what is called an “Attorney-in-Fact” to act on your (the Principal’s) behalf.

 

Sometimes the POA is very limited and is only valid for a certain time period (think traveling abroad, and having someone available to handle finances while you’re out of the country) or for only a certain act (think someone signing for you at a real estate closing because you’re out of town).

 

Sometimes the POA is broader and allows your Attorney-in-Fact to step into your shoes and stay there for an undetermined amount of time.  It is this second scenario that is more often (but not exclusively) used in estate planning.  When you have a broader POA it is crucial you choose someone who is trustworthy and good with finances to act as your Attorney-in-Fact.  Consulting with an attorney is helpful in making that determination.

 

Some people assume because they have been named as their parent’s Attorney-in-Fact that they are also the executor or Personal Representative of their parent’s estate.  That is sometimes true, but is not automatic.  The POA is only valid while the Principal (the person whose POA it is) is alive.  The executor or Personal Representative is named in the Will and only has the ability to transfer funds after the Probate Court gives them that power.  To learn more about the Probate Process and the Personal Representative, click HERE.

 

The POA is only the start of an estate plan.  Some people may have more than one POA associated with their estate.  Only an attorney can help you make that determination.  It is the general rule that anyone over the age of 18 should have a POA.  The POA should certainly be updated during major life events: marriage/divorce, having children, or death of a spouse.  The POA should be reviewed to determine if additional updates need to happen more often.  An attorney can help you determine when is right for you to review or update.

 

If you have questions about estate planning for yourself or your family, contact Claire Tralle to set up a free initial consultation today.

 

The information in the Journey Into Estate Planning series are intended to provide information only.  No legal advice is being provided or implied via this blog post.  No attorney-client relationship is formed by providing this information.  An attorney-client relationship with Tralle Law, LLC is formed only after a retainer contact is signed by all parties.