A durable power of attorney is a legal document that allows you to name someone to help with your financial affairs whenever you would like and if you become unable to handle them yourself. The person you name should be someone you trust with your finances, someone who could make decisions about your finances if need be. That person also could be your health care proxy or health care buddy.
Why should you give someone a durable power of attorney? First and foremost, giving someone you trust a durable power of attorney should give you peace of mind that your affairs will be taken care as you would like, if you cannot take care of them. Otherwise, the person you would want to have the durable power of attorney would have to go through an expensive and lengthy court proceeding to make these decisions. Moreover, without the durable power of attorney, a judge might appoint someone you do not trust to handle your affairs. The durable power of attorney lasts until you die.
What is the difference between a durable power of attorney and a power of attorney? If you simply give someone a power of attorney, then the person you designate only has authority over whatever financial matters you specify until you become mentally incompetent. But, if you choose, you can make the power of attorney document a durable power of attorney. You need only include language in the power of attorney that specifies that the person you designate has authority if you become mentally incompetent. Unless you make the power of attorney a durable power of attorney, the person you designate cannot handle your financial affairs after you become mentally incompetent.
Who should have a copy of your durable power of attorney? You should give a copy of the durable power of attorney to all financial institutions at which you have accounts.
If I give someone a durable power of attorney, will that person be able to take money from my bank accounts? Yes. The person you name as having durable power of attorney, your financial agent, will be able to take care of your financial affairs using your bank accounts if you give them that authority. But, this agent does not own the money in your accounts and may not take money from your accounts for himself or herself.
What should I discuss with the person I name as having durable power of attorney? You should let your agent know about all institutions with which you have financial arrangements, including your banks, credit card companies, financial advisors and insurance companies.
Can I change or cancel the durable power of attorney? Yes. You can cancel or change your durable power of attorney at any time by destroying it and notifying the financial institutions at which you have accounts that you have destroyed it or changed it.
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