Power of Attorney

Article submitted by Kay Richter, Attorney at Law.
For more information, she can be reached at 520-318-1301.

Who needs a Power of Attorney? Most everyone should have a springing durable Power of Attorney. This Power of Attorney comes into force only if a person has a disability. In other words, if you are fourty years of age and have a car accident and cannot pay your mortgage, utilities, etc... this Power of Attorney would allow your agent to pay your bills and manage your assets until you are able to manage again yourself.

If you decide not to have a Power of Attorney or a Trust, someone would have to go to court to pay your bills. This procedure is called a conservatorship. It is costly and cumbersome. Also, the court may appoint a conservator who is not the person you want. It is much better for you to chose who you wish. The court procedure is not a pleasant experience.

The Power of Attorney must be "Durable". What this means is that the Power of Attorney comes into being if there is a disability.

If a Power of Attorney is not durable and many are not, then it terminates if you have a disability. Most people want the Power of Attorney at the time they are disabled. If you have a Power of Attorney, it is important to check to see whether it is durable or not.

Additionally, it is important to redo your Powers of Attorney every three to five years. Otherwise, some institutions may not honor the Power of Attorney. Some banks, brokerages and credit unions may say that the document is too old. You should also check with the institutions that you have accounts with to make sure they would recognize the Power of Attorney. Some institutions will also say that they will only recognize Powers of Attorney with specific language that they want or that they only recognize their own Powers of Attorney.

Who does not want this type of Power of Attorney? If you do not have someone who your trust and feel is competent to serve in this capacity you do not want it. However, there are care manager agencies who will act under a Power of Attorney if a person does not have such a person.

A Trust is a more foolproof way to have someone manage your assets at the time of disability for many people.