A durable power of attorney is one of the most important documents you can sign to protect your finances. If an illness, injury, or dementia ever leaves you unable to manage your own affairs, it lets a person you trust step in right away. Without one, your family may have to go to court.
What is a durable power of attorney?
A power of attorney is a document in which you name another person, called your “agent,” to act on your behalf. A durable power of attorney stays in effect even if you later become incapacitated, which is exactly when your family needs it most.
Depending on how it is written, your agent may be able to pay your bills, manage your bank and investment accounts, deal with Social Security and the VA, handle real estate, file tax returns, and work with insurance companies for you.
Why it matters
If you lose the ability to manage your finances and have no valid power of attorney, your family’s main option is often a guardianship. Guardianship is a court proceeding that is public, takes time, costs money, and comes with ongoing court supervision. A properly prepared durable power of attorney is the most common way families avoid it.
Planning for long-term care
For many families, the power of attorney becomes the key document if a parent later needs nursing home or in-home care. Medicaid and long-term care planning often require an agent to have specific authority. A generic or outdated form may leave your agent unable to take the steps that could protect your savings, at the very moment those steps matter.
Choosing your agent
Your agent will have significant control over your finances, so choosing the right person, and a backup, is one of the most important decisions in your plan. We help clients think through that choice and what authority their agent should and should not have.
Specific legal requirements, and why they matter
Power of attorney laws have highly specific legal requirements, and the choices made in drafting one carry real legal and financial implications. A document that misses a requirement, or that does not grant the right authority, may be rejected by a bank or fail when your family needs it most. Online forms and documents signed in other states often fall short.
Our attorneys are experienced at drafting durable powers of attorney to the correct legal specifications and tailoring each one to fit your needs, your family, and your long-term care goals.
Don’t wait
A power of attorney can only be signed while you have the capacity to do so. Once a diagnosis such as dementia makes capacity uncertain, options narrow quickly. The best time to put one in place is now.
Related planning
A durable power of attorney works best alongside advance health care directives for medical decisions, a will or revocable living trust, and, where long-term care is a concern, Medicaid asset protection planning.
Contact us today for a consultation
Jackson+Jackson helps families plan for long-term care. Call us to schedule a consultation at any of our offices in New Orleans, Birmingham, Mobile, or Pensacola.
This article provides general information only. It is not legal advice, and reading it does not create an attorney-client relationship. Every situation is different; please consult an attorney about yours.