When most people consider estate planning, they usually think about what will happen after death. Unfortunately, many underestimate the need to prepare for their risk of disability. While a will does not take effect until death, a General Durable Power of Attorney protects an individual’s financial, legal, and business matters if a person is declared incompetent. Our team at Skeeters, Bennett, Wilson & Humphrey wants you to be as prepared as possible when planning for your future. Here, we answer common questions about Power of Attorney documents.
Central Kentucky Power of Attorney FAQs
Q: What is a Power of Attorney?
A: A Power of Attorney (POA) is a written document in which a "principal" (the person creating and signing the POA) appoints someone to act on their behalf. The POA, known as an "agent" or "attorney in fact," can be a trusted friend, family member, or multiple people sharing the role.
Q: What will my POA control?
A: The notarized document gives powers to your attorney in fact or agent that may be as broad or narrow as you wish. For example, a POA could include financial and dispositional authority over matters such as:
- Safe deposit boxes
- Real property
- Personal property
- Financial accounts
- U.S. Treasury Bonds
- Monies you're owed
- Claims against you
- Legal proceedings
- Tax returns
Q: Why do I need a POA?
A: A power of attorney (POA) is necessary to make crucial decisions on your behalf in case you become disabled or incapacitated and cannot make decisions for yourself. Without a POA, a guardian cannot be appointed until a court declares you incompetent after a jury trial. This process is costly, time-consuming, and public. However, having an established POA for your business and financial matters can help you avoid a court-appointed guardianship and the lengthy legal proceedings that come with it.
Q: When does a POA become effective?
A: A POA becomes effective immediately after you sign it. However, unless you are found incompetent or disabled, you will still have the right to make all decisions for yourself, regardless of the appointment of an agent to act on your behalf. The POA remains in effect until:
- You formally revoke it with written notice to your agent or attorney in fact
- Your guardian terminates it with court approval
- Your death
Q: Who can I appoint to be my POA?
A: Almost any adult can serve as your attorney in fact, with certain exceptions. We recommend choosing a person whom you trust and who is knowledgeable about your wishes, values, and religious beliefs. You should also discuss the possible appointment with the person (or persons) you've chosen as your agent to ensure they understand--and agree to accept--the responsibility.