Words Todd G. Wiebe, Notary Public, Salvador Davis & Co.
A Power of Attorney is a legal document that grants another person, known as the “attorney,” the authority to act on behalf of another person, referred to as the “adult,” in particular legal and financial matters.
The significance of having a Power of Attorney cannot be overstated as it authorizes another person to manage your legal and financial affairs.
It allows individuals to appoint someone, often a family member, they trust to make critical decisions on their behalf if they are unable to do so themselves.
The attorney then has the power to make any financial decisions on behalf of the adult. This makes the document extremely “powerful.” You must implicitly trust this person as there may be a time where you cannot watch over what the attorney does and the attorney could misuse their position.
It is commonly understood that a Power of Attorney becomes effective when the adult loses capacity, but it can be structured to allow the attorney to make decisions while the adult is capable. Attorneys may be asked by the adult themselves to assist the adult in instances when the adult is travelling but selling their house at the same time, or when the adult is perhaps capable but less confident in managing some of their more complex financial tasks, such as investment or income taxes.
Without a valid Power of Attorney, or court appointment, there is no person who can manage affairs for another person. This even applies between spouses. Each person must decide whom they wish to trust with this critical role. The Power of Attorney indicates that you do, in fact, trust the person who is attempting to assist you.
Along with the significance of a Power of Attorney being in place as preparation for any capacity inhibiting events, it allows the adult to have peace of mind for who exactly will be managing these affairs should they ever need to. Acting as Power of Attorney can be a time consuming job at times, and requires a certain type of person who is willing to accept that position. Allowing yourself time to decide who in your life you believe fits the criteria of the role and has your best interests is vital.
An Enduring Power of Attorney is a personal planning tool that is best used in concert with a Will and a Representation Agreement, which appoints a medical decision maker. It is strongly recommend that each person have a Power of Attorney, regardless of age, drafted by your notary or lawyer.
