Power of Attorney
A power of attorney allows you to appoint another individual to transact business in your name. A power of attorney gives an agent (called your attorney-in-fact) the authority to make banking, real estate and all other financial transactions on your behalf. There are two primary types of powers of attorney: the durable power of attorney and the springing power of attorney. With a durable power of attorney, the authority you grant to your attorney-in-fact becomes effective as soon as you sign the document and continues to be effective upon any disability or incompetence you may suffer. Thus, if those events do occur, you have an individual in place to manage your financial affairs. By contrast, a springing power of attorney is so-called because it “springs” into action if you become incapacitated.
A power of attorney is particularly important, as it may allow you to avoid the costly and complicated Guardianship procedure which may otherwise be required when an individual becomes incapacitated for any reason, including accident, disease or age. In addition, it can prevent any difficulties involved with the management of your financial affairs while a Guardianship proceeding is pending and before a Guardian has been appointed by the court.