What Is a Durable Power of Attorney?
If you have a will, you may think that your estate plan is complete. Because a will only goes into effect upon your death, however, it has no impact on your financial affairs – or your estate – during your lifetime. So what happens if you become incapacitated and can no longer manage your own finances and other important matters? If you experience a debilitating illness or suffer a catastrophic accident, your will won’t help you. This is where having a Durable Power of Attorney is critical.
In Minnesota, a Durable Power of Attorney is a relatively simple yet powerful document that allows you (known as the principal) to appoint a trusted, responsible person (called an attorney-in-fact) to handle your affairs in the event of your incapacity.
What Can a Durable Power of Attorney Do?
With a properly-executed Durable Power of Attorney, you can give your attorney-in-fact authority over a broad range of financial matters. Common powers include authorization to:
· Pay your bills
· Pay for your everyday expenses (food, clothing, other personal needs)
· Balance your check book and conduct online banking
· Manage real estate
· Pay property taxes
· File and pay income taxes
· Purchase insurance on your behalf
· Oversee investments and retirement accounts
Without a valid Durable Power of Attorney in place, your family members may have to obtain a Conservatorship to ensure your finances are properly handled. Because this requires a court proceeding, which can be costly and time-consuming, it is prudent to create a Durable Power of Attorney while you are in good health and of sound mind. By drafting a Durable Power of Attorney now, you can also choose an attorney-in-fact whom you trust with your finances rather than leaving that decision to the court.
Minnesota Estate Planning and Probate Law Firm
To learn more about powers of attorney and the key documents in any comprehensive estate plan, call the Minnesota probate and estate planning attorneys at Jeffrey P. Scott & Associates, LLC today. (651) 968-1457.
This website has been prepared by Jeffrey P. Scott & Associates, LLC for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.