What is financial power of attorney? This is a question that many people don’t know the answer to. Financial power of attorney is a legal document that allows you to appoint someone else to make financial decisions on your behalf. There are three main types of financial power of attorney: general, limited, and durable. In this article, we will discuss each type and how they work.
Financial power of attorney is a legal document that allows you to appoint someone else to make financial decisions on your behalf. This could be helpful if you are going through a medical procedure and will be unable to make financial decisions yourself, or if you simply want someone else to handle your finances for you. There are three main types of financial power of attorney: general, limited, and durable.
General financial power of attorney gives the person you appoint (known as your “agent” or “attorney-in-fact”) broad powers to handle your finances as they see fit. This can include paying bills, investing money, buying or selling property, and more. You can give your agent as much or as little power as you want, and you can change the financial power of attorney at any time.
Limited financial power of attorney only allows your agent to handle specific financial tasks that you specify in the document. For example, you may give your agent permission to sell your car but not your house. Like a general financial power of attorney, you can change or revoke a limited financial power of attorney at any time.
Durable financial power of attorney is similar to the general financial power of attorney, but it remains in effect even if you become incapacitated and are unable to make decisions for yourself. This means that if something happens to you and you are unable to handle your own finances, your agent will still have the authority to do so. If you want a durable financial power of attorney, it must be specifically stated
A springing financial power of attorney only goes into effect under certain conditions, which are specified in the document. For example, a springing financial power of attorney may state that it will only go into effect if you become incapacitated. This type of financial power of attorney gives your agent less authority than a durable financial power of attorney because it is not effective until a specific event occurs.
Creating a financial power of attorney is an important part of estate planning. By taking the time to create this document, you can ensure that your finances will be taken care of even if something happens to you.