A Durable Power Of Attorney (a regular non-durable Power of Attorney terminates when the principle loses capacity) is what you will need when you want to give your spouse, son, daughter or any person you trust and designate (referred to as your “agent”) legal authority to act on your behalf in the event you lose legal capacity, so that they would be able to perform some of the following tasks for you (this list is not exhaustive):
- Sign contracts on your behalf
- Access your bank accounts
- Sell and buy stocks or bonds or other investments
- Sell, buy, or pay for repairs for a house with your money or an additional mortgage in your name
- Manage your personal property and real estate
- Operate, manage, buy or sell your business interests
- Sell, buy, or continue to pay insurance on your behalf
- Pursue or defend legal claims on your behalf
- Exercise elections available to you under federal, state, local, or foreign tax law
- Conduct transactions with regards to your retirement plan(s)
- Accept and/or make gifts on your behalf
- Act on your behalf concerning any estate, trust or other transactions that you may have a beneficial interest
- Prosecute and/or defend lawsuits on your behalf
- Perform acts on your behalf in order to maintain the standard of living for you, your spouse, or your children
- Pursue a claim relating to public benefit or entitlement that you may qualify for
- Make gifts and/or engage in asset protection planning and take all steps necessary to obtain eligibility for public benefits on your behalf
- Create or modify trusts on your behalf
- Create or change beneficiary designations and/or rights of survivorship
As you can see, the Durable Power of Attorney is one of the most powerful legal documents in existence as your selected agent can step in your shoes and act in your behalf in an incredible variety of ways. However, some powers granted to the agent for one client may not be appropriate for another client even if both respective clients have nearly identical asset portfolios. For example, you love your kids all the same and you love your spouse from your second marriage just as much. However, if your kids and their step-parent don’t get along at all but you want one of your kids to serve as your agent under your Durable Power of Attorney, you may not want to give your agent the authority to change beneficiary designations to retirement plans, especially if you list your spouse as a beneficiary whereas this may not be much of a concern for a client whose children are also his spouse’s children.
