What is a Financial Power of Attorney?
Medical power of attorney is one thing while financial power of attorney is another thing. Sure, both are genres of POA and a power of attorney lawyer can help you with both. Though, the kinds of powers they individually grant are practically opposite sides to the spectrum. Most people probably need to give medical POA if they really want that extra layer of health security.
That kind of POA may only involve dealing with your assets in terms of paying the health professionals. Financial POA can deal with just about every asset that’s in your name.
That’s just one part of the basics. Below, you’ll find more information. These sections will help you understand things such as why this kind of POA doesn’t mean that you have to hand over full control of your cash.
You could give near-limitless power over your money, but nobody’s making you. This might be your way of preventing your family from needing a conservator for you.
Money Talks
The title is by no means false advertising. When you give someone financial power of attorney, you’re really giving them power over most of your financial decisions. That’s a bit of an overstatement, as you can always choose to only give limited power. Granting someone POA of any kind is, more or less, giving permission to any decision they make within the area(s) that you allow.
Generally speaking, if the area is somehow connected to your finances, you might be able to grant legal power over that area to someone else. The big point here is that you have to give that power to someone else if you want them to have POA over it. Don’t interpret that the wrong way and think that it means that you can’t have a guardian if you refuse to give POA to someone. Please note, however, that you’re ultimately the person who gets to decide whether or not anyone gets financial POA over your finances.
Your Money and Not Theirs
Losing money is an understandable fear. It goes without saying that you should pick someone that you really trust should you need to grant them POA. Honesty is a non-negotiable qualification. They’re taking care of your money and that money doesn’t become theirs when you give them financial power of attorney regardless of you becoming incapacitated. Incapacity is also the reason to get a healthcare power of attorney.
They don’t even necessarily get financial benefits for helping you out. It’s hypothetically possible that someone can help you out without having you spend anything.
Generosity is still an option. You can still send them something as a thank-you. Grandma’s award-winning cookies are a solid example. Please note that the person who’s helping you, assuming they’re a decent human being, is probably doing this in order to help you.
They may have their own goals such as protecting your assets for future generations or making sure that you have an emergency fund saved up. With that said, it might be best to discuss things you do and don’t want them to do. They may have power, but you can still have updates and discussions.
Stuff They Can Do
Since limited POA is always an option, assuming you have the power to grant power of attorney, you might want to have a guide on what someone can do with financial POA. You may even find that you don’t want their powers to be limited and for them to do whatever they see fit. You can hate doing your taxes and by granting this kind of POA, someone can be responsible for doing them for you. Aging can have its perks.
For small business owners, financial power of attorney might be a must. You can grant someone the power to run your small business for you, helping ensure it stays up and running. They can also invest your cash into things like bonds and stocks. Property is something they also might be able to manage. Should a trust need to be set up with some of your assets, they can be called in to do the job. There are tons of other things they can do and consider asking them about potential ideas.
Who to Pick
As long as the person you have in mind has already had their eighteenth birthday and they’re of sound mind, that’s really all they need to have in terms of legal requirements. Perfect people aren’t necessary.
As long as they’re able to function as a capable adult, they can probably receive POA from you or anyone. What you need to be concerned about is if they can actually carry out the tasks you have set out for them. If they become incapacitated, they might need someone to help them out just like you may need them to help you out should you become incapacitated.
What you need to worry about more so is who you can trust to do the job. Honesty should be your first factor to be concerned over. Someone who has the brains to do the operation might be an ideal candidate, but you don’t want anyone who’s willing to lie about money. Mistakes are sometimes permissible.
Though, it’s your money and you should act like you’re asking them to guard your cash. You need to be willing to hand this person whatever you want them to have power over and be able to feel safe about it.
Basic Steps
There, you should now have a basic idea of what financial power of attorney involves. There’s more to it, sure. That’s why having an attorney from the law firm of Flanders Law Firm LLC might be beneficial. Their assistance is just a dial away at 612-424-0398.
Power of attorney law doesn’t need to be confusing even if you’re still putting the pieces together. Having an expert on your side might be the path to success. Should you be ready and willing to sign the legal documents as soon as possible, someone can help you there, too. How you go about giving POA is ultimately up to you. Though which attorney you can trust isn’t something that you need to worry about. The answer to that question you already have.
