Readers in West Palm Beach who tuned into a recent discussion about the points to consider when choosing a trustee may want to apply the same notions when it comes to planning for incapacity. According to one personal financial specialist, one of the biggest choices when it comes to executing powers of attorney may be the determination of who will serve as your agent for making important personal decisions.
Powers of attorney are a common and important component of a comprehensive estate plan. A power of attorney for finances gives another person the legal authority to conduct financial transactions on behalf of the principal. With a valid power of attorney, the authorized agent can take care of business transactions like paying bills, making investments, purchasing insurance policies and closing out accounts that no longer serve a useful purpose.
Prior to October, 2011, Florida law allowed for the creation of a "springing power of attorney" that would not grant any authority to the designated agent until the principal had been determined to lack the capacity to independently communicate financial decisions. A change in state law means that springing powers of attorney created after September 30, 2011 will not be effective, though any legally valid springing power of attorney created before the law went into effect will continue to function as normal.
The change in Florida law means that any newly created power of attorney takes effect at the time of execution. That instant grant of authority to the agent makes the choice of an agent all the more important. A consultation with an experienced estate planning professional can help clarify the most important points to consider and help make it easier to choose the best agent to handle one's personal affairs.
Source: Nevada Appeal, "John Bullis: Understanding financial power of attorney forms," John Bullis, Sept. 18, 2012