The role of a durable financial power of attorney

On Behalf of | Jun 27, 2019 | Estate Planning | 0 comments

Some people in Oregon may want to use a durable financial power of attorney as part of their estate plan. This document appoints someone to manage a person’s finances if that person becomes incapacitated.

It differs from a medical power of attorney, which appoints someone to handle medical decisions in the event of incapacity. It also differs from a regular power of attorney, which could become invalid from the moment a person becomes incapacitated. Without a durable power of attorney, a family may have to go through a stressful and expensive legal process to have someone declared incapacitated. There is also a “springing” power of attorney that takes effect when a person becomes incapacitated. However, this may require a doctor’s certification that the person is incapacitated, so it could also come with delays.

A power of attorney can grant a broad number of legal powers to the appointed person, and it is possible to limit or expand some of those powers. The person may be able to deal with banks, investments, real estate, retirement accounts and other affairs. The agent could also be given other rights, such as preparing and signing tax returns. Preparing a power of attorney correctly can be complex, and an attorney may be able to assist a person in doing it.

An attorney may also be able to help with other elements of estate planning. This could include preparing other documents in case of becoming incapacitated and deciding whether a will or a trust is needed. For many people, a will is sufficient for passing assets down to loved ones, but there are many circumstances in which a trust may be an appropriate choice. A trust can allow assets to be distributed more quickly than a will since it generally avoids the probate process.