Understanding Durable Powers of Attorney

 Posted on January 23,2018 in Estate Planning

Research shows that only about half of Americans have any estate planning documents in place. Those without a last will and testament and other critical estate planning documents risk having their estate decisions made for them if they pass away or become incapacitated. One vital piece of estate planning that is important for anyone to have is a power of attorney. A durable power of attorney is a legal document which gives someone else the authority to act on your behalf if you cannot do your yourself.

Types of Power of Attorney

A general power of attorney assigns an agent which will be responsible for the medical decisions, legal choices, personal banking, investment, insurance and real estate transactions of the person signing the document (the principal) should they become incapacitated. A special power of attorney allows the principal to be more specific. He or she can narrow down the types of choices the agent(s) can make. It is possible to have several different powers of attorney for different purposes. An individual may choose their spouse or family member to make medical decisions on their behalf, but he or she may choose another individual to make financial or business decisions in the event they are incapacitated.

It is important to note that a power of attorney does not remain in force after the principal passes away. A power of attorney only grants the agent the authority to make decisions while the principal is living. When the principal dies, other estate planning documents, decision-making authority is given to the executor and any named trustees, as specified in the principal’s estate plan.

Do Not Wait

It is best not to hesitate when it comes to making decisions about estate planning. As the old saying goes, it is better to be safe rather than sorry. Families should prepare these legal documents long before a loved one is unable to make decisions for himself or herself. In order to be valid, the person establishing a durable power of attorney must be capable of deciding to seek assistance through a power of attorney.

When creating a power of attorney, it is also important to select an agent who is up for the task. He or she must be willing and able to make decisions as required. Principals should also consider the prospective health and life expectancy of his or her agents as well. For example, selecting a power of attorney with health concerns of their own may be not be the wisest choice.

Planning for the Future

Choosing the right estate planning instruments can be challenging, so it is important to get responsible legal advice along the way. Contact A. Traub & Associates to learn more about how our experienced Lombard estate planning attorneys can help you provide your family with the security and peace of mind they deserve. Call 630-426-0196 today to schedule an appointment.

Source:

http://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2113&ChapterID=60