Retirement means making decisions on housing, income, investments, health care and estate planning—many of which can be emotional and may require major life changes. The timing of all of these decisions and their interaction also requires careful planning.
The Harvard Press says in its recent article, "Older & Wiser: Powers of Attorney," that because of the complexity of these issues, many people seek professional assistance regarding retirement living and estate planning. While many of us are tempted to avoid uncomfortable decisions, careful planning can save you thousands of dollars and can help you avoid unnecessary guardianship or institutionalization.
Powers of attorney are documents executed by an individual, the "principal," to give another individual, the "attorney-in-fact," power to decide issues on the principal's behalf. The principal has the ability to define the scope of decision-making authority in the power of attorney document.
Based on how they're drafted, powers of attorney can become effective in different ways. A durable power of attorney must be executed while the principal is still competent. It will be immediately effective and stay in effect, even if the person becomes incapacitated. A springing power of attorney is different. It becomes effective when the person is no longer competent.
A durable power can be used without the consent of the individual but must be used to the person's benefit. The springing power lets the person creating the document keep control over his or her affairs as long as it is practical. Both of these types of documents may be revoked by the principal in writing.
Drafting and executing power of attorney documents is an individualized process that varies depending on the circumstances. So it's never a good idea to use a boilerplate form from the Internet that doesn't reflect the individual's needs and circumstances.
A properly drawn and executed power of attorney provides individuals peace of mind and assurance that their affairs in the future will be addressed appropriately. Contact a qualified estate planning attorney.
One of the main goals of our law practice is to help families like yours plan for the safe, successful transfer of wealth to the next generation. Call our office today to schedule a time for us to sit down and talk about your estate plan, where we can identify the best strategies for you and your family to ensure your legacy of love and financial security. Our office is located in Santa Ana, CA but we serve all of California including Irvine, Orange, Tustin, Newport Beach, and Anaheim.
Reference: Harvard Press (April 28, 2016) "Older & Wiser: Powers of attorney"