I once met with a family dealing with a terrible, unexpected crisis. A family member had been seriously injured in an automobile accident and faced months – possibly years – of recovery. His cognitive abilities had been seriously affected. For at least the foreseeable future, he would not be able to make any decisions. However, legal, financial, and other decisions still had to be made.
He needed a power of attorney. A power of attorney is a document which allows you to grant another the authority to act for you. A person granted authority under a power of attorney can pay bills, or deal with banks, investments, taxes, etc. Granting a power of attorney does not mean you have given up any authority. It simply means someone else can also handle tasks for you.
Unfortunately, this person had not signed a power of attorney. Once the accident occurred, it was too late. If someone does not have the capacity to make decisions, they do not have the capacity to sign a power of attorney.
This man’s affairs still had to be addressed. However, the banks or other institutions were not going to work with family members to manage those affairs. Simply being a family member, even a spouse, does not carry sufficient authority to make decisions on which others can rely.
In these circumstances, the only alternative is usually to go to Court and have someone appointed as a guardian. This appointment will authorize the guardian to handle the same responsibilities that could have been handled with a power of attorney. However, the process to become a guardian is much more complicated – and expensive. A guardianship can only be granted by a judge, and only after input from a health care provider, a social worker, and another attorney. On the other hand, a power of attorney only requires your signature . . . so long as you have the ability to choose who you want as your power of attorney.
Come to a free, no obligation presentation to find out these and other simple steps to protect your estate.