A durable power of attorney is a document in which you appoint an “attorney-in-fact also sometimes called an agent” to do anything on your behalf that you, the “principal” could do for yourself. The attorney-in-fact, in effect, stands in your shoes and acts for you on financial, business and other matters. Your attorney-in-fact can be any competent adult that you trust.
Giving someone a power of attorney does not limit your rights in any way. It simply gives the other person the power to act when you cannot. Your attorney-in-fact would be your fiduciary. A fiduciary is a person who is held to a high standard of good faith, fair dealing and undivided loyalty to the principal. The attorney-in-fact must always act in the principal’s best interest. The attorney-in-fact should keep complete records of what they do in case there are any questions of impropriety or bad faith dealing.
A power of attorney normally, takes effect as soon as the principal signs it. Most people do not intend that their durable power of attorney be used until they are incapacitated. The principal should discuss this with their attorney-in-fact so that both parties are clear on what the principal’s wishes are so that they can be carried out without delay or question.
A principal may revoke a power of attorney at any time. All the principal needs to do is send a letter to his or her attorney-in-fact telling the attorney-in-fact that their appointment has been revoked. From the moment the attorney-in-fact receives the letter, they can no longer act under the power of attorney. If want to have proof that this letter was in fact received by the attorney-in-fact, send the letter certified signature required.
Your Durable Power of Attorney should be updated every 3-5 years or as soon as possible after a major life event (i.e. marriage, divorce, birth of a child, death of a family member, etc.)
Have questions or concerns about your estate planning? Contact us to discuss further:
E.M. Curran & Associates LLC