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Don't Have a Power of Attorney Yet? This Is Why You Should

Don't Have a Power of Attorney Yet? This Is Why You Should

March 14, 2023

Financial planning involves more than just planning a secure income for the future. It also means protecting that income and your assets from a variety of things that can happen, particularly those unforeseen events that tend to change life in an instant. The more protections you consider, the more you can probably rely upon your decisions to protect you in coming years. 

So, if you haven’t established a power of attorney yet, here’s why you should. 

A power of attorney allows someone else to make important decisions for you. This document designates someone (or more than one person) to make legal decisions regarding your property, finances, and healthcare. This could include paying bills, making real estate decisions, taking withdrawals from the bank or a retirement plan, and organizing both the emotional and financial aspects of medical care. 

A variety of situations can occur that are beyond your control. Typically, we think of a power of attorney as a legal arrangement that takes effect if you’re seriously injured or sick. And it’s true that if you’re unconscious or on life support, someone does need to make important decisions for you. 

But that’s not all a power of attorney does. Mental incapacity can strike any of us, and dementia or Alzheimer’s can be sneaky. A person can seem perfectly healthy and yet gradually, over time, their doctor begins to feel concerned about their ability to handle finances and other important matters. If you’ve established a power of attorney at a previous time, your physician can take steps to have it legally enforced at this time. 

A power of attorney also gives someone the ability to make important decisions in the event that you’re out of the country. If you plan to travel abroad, establishing a power of attorney can protect your legal and financial interests in the United States in the event that something prevents you from returning as planned. 

And no, a power of attorney doesn’t “give away all your rights.” These documents can be structured in a variety of ways offering these privileges under strict circumstances only, or in a limited way depending upon your wishes. 

If you haven’t yet met with an estate planning attorney, take that important step soon. And let’s meet to discuss how a power of attorney impacts your long-term financial plans, so that we can coordinate with your attorney should the need arise.