Understanding the Importance of a Financial Power of Attorney

Medical emergencies can befall any of us, at any time. Though this is an unpleasant reality, it’s one that we need to think about, particularly during the estate planning process. For example, estate planning provides a number of tools for ensuring that your wishes are carried out, even if you fall into a coma or become incapacitated in some other way.

One such tool is the financial power of attorney. In this post, we’ll explain what this document is, why you might need one, and how a power of attorney lawyer can help you.

What is a Financial Power of Attorney?

Let’s begin with a simple definition.

A financial power of attorney is a legal document, allowing you to appoint another person to serve as your representative, should you become medically incapacitated in any way.

When you lose the ability to communicate your wishes, the financial power of Lawyer goes into effect, imbuing your chosen representative with authority to handle financial or business decisions in your stead.

Should you regain consciousness, the power of attorney immediately goes out of effect, meaning your chosen representative can no longer act in your interests.

Financial Power of Attorney vs. Medical Power of Attorney

As you consider the durable power of attorney, it’s important to note that there are two basic types: The estate planning attorney, and the medical power of attorney.

While a financial power of attorney lets you appoint someone to represent you in business matters, a medical power of attorney allows you to choose someone who can make decisions about your healthcare, should you be unable to make those decisions on your own.

In some instances, it may be wise to have both documents included in your estate plan. A power of attorney lawyer can advise you further.

What Can a Financial Power of Attorney Do?

A common question regarding the durable power of attorney: Exactly what can your legal representative do? What kind of decisions are they authorized to make on your behalf?

A financial power of attorney lawyer can outline the specifics, but for now, we’ll offer a few examples. The person you name to be your legal representative may be able to do any of the following:

  • Complete real estate transactions in your name
  • Buy or sell a business on your behalf
  • Pay your bills or outstanding debts
  • Make changes within your investment portfolio

These are just a few examples; for a broader understanding, we’ll recommend once again that you speak with a financial power of attorney lawyer.

Other Options to Consider

When meeting with an estate planning attorney, it may be helpful to ask about some other estate planning documents. For example, an advance health care directive or a living will allow you to specify your wishes with regard to life-saving medications, procedures, or support systems. These documents can work well, either to replace or to supplement your power of attorney. Again, ask your power of attorney lawyer for their specific advice here.

Speak with an Estate Planning Lawyer in Fremont

None of us can predict what tomorrow will bring; and while we don’t want to imagine that we could be suddenly incapacitated, it’s a contingency worth planning for. An estate planning Lawyer  can help you do so.

Ready to learn more about powers of attorney and other crucial estate planning documents? Reach out to the lawyers at Singh Law Firm in Fremont, California. We’re here to answer your questions and help you develop an estate plan that upholds your wishes. Contact us to make an appointment.

Leave a Comment