If you suffer a serious health event or accident and become incapacitated, the world doesn’t stop turning. You’ll still have bills to pay and you’ll still need to manage your investment accounts. A durable power of attorney is a way for you to make sure that someone — who you choose and designate — will have the power to manage your investment accounts and other financial details.
The agent designated in your durable power of attorney will be able to deposit money, withdraw many, write checks, pay bills and make decisions with your investment advisors regarding your financial accounts. Since a high degree of financial responsibility will be involved in these tasks, you want to make sure you choose an agent who is responsible and capable of navigating the world of your finances.
It’s important not to confuse a power of attorney with a durable power of attorney. The durable power of attorney “endures” when you become incapacitated. A power of attorney stops being valid at the moment of your incapacitation.
As a final note, it’s important to keep in mind that many financial institutions in Michigan will be wary of an agent who approaches them with your durable power of attorney documentation. They will be concerned that this person is trying to swindle you. To prevent distrust from your financial institutions being directed at your agent, be sure to discuss with your financial institutions how they would prefer you create and set up your durable power of attorney. You may also want to ask them if they have their own durable power of attorney format that you should employ.
Source: Forbes, “The Biggest Estate Planning Mistake People Make,” Brad Wiewel, Aug. 16, 2017