An essential element of estate planning is deciding what should happen if you become incapacitated. In the event an injury or illness leaves you unable to express your wishes or make decisions for yourself, it’s important to have someone you trust to act on your behalf. Establishing a financial power of attorney will ensure a friend or family member can step in and take control of your finances in this situation. Here’s an overview of why this legal document should be part of your estate plan.
What Does a Financial Power of Attorney Do?
Setting up a financial power of attorney will allow another party to make personal transactions for you if you’re temporarily or permanently incapacitated. The document can be written to grant authority over certain tasks, including writing checks, opening accounts, filing taxes, accessing safe deposit boxes, managing investments, and buying or selling real estate. You can decide if it should go into effect immediately or only at the moment of incapacitation.
What Happens if You Don’t Have One?
Someone must handle your finances and financial obligations if you’re no longer able to. This is because taxes and other legal dues must still be paid. Thus, if you fail to have a financial power of attorney in place, a spouse or other family member will need to petition the court for guardianship to gain access to your assets. This can be a time-consuming and costly legal process, as well as an emotional strain for the individuals involved.
If you allow the courts to decide who will take care of your funds, you also lose the ability to make that choice yourself. By creating a legally binding power of attorney, you can choose a family member or friend who has financial expertise, or who you trust to have your best interests at heart.
If you have yet to establish a financial power of attorney, reach out to Stephenson & Stephenson, PA for guidance. They can assist you in all aspects of estate planning to ensure you’re prepared for whatever life may bring. For over 35 years, they’ve proudly provided residents in and around Sanford, NC, with high-quality, personalized legal services. Call (919) 774-6182 to schedule a consultation, or visit them online for more information on their estate planning work.