A complete estate plan is built around the Living Trust and includes the Durable Power of Attorney for Personal and Financial Affairs. Many people think that estate planning only concerns what happens to you after you die. This is not true. The goal of estate planning is to preserve your estate while you are still alive and then distribute these assets properly upon your death. This power of attorney is important in protecting your estate while you are still alive.

The Power of Attorney for Financial Affairs is needed because it spells out what will happen should you become incapacitated for any length of time in the future. This might happen in the short term if, for example, you got in a car accident and were in the hospital for a few months. Who would take care of your bills and your mortgage payments? Some bills may go unpaid while your loved ones scramble to gain the authority to write checks for you. This can all be resolved easily with some planning. You can designate who will be your agent in the future should something happen. Then that person could easily step in and help you.

This could happen for the long term if, for example, you got Alzheimer’s disease. As we are living longer and longer, the possibility of coming down with some form of dementia or another is becoming greater. With this type of power of attorney in place, your loved ones can easily step in and take care of you as you intended.

It is a wealth preservation strategy because if there is a time when no one is able to you, your assets may be diminished without any supervision. The Power of Attorney for Financial Affairs makes sure that you have a plan in place so that this doesn’t happen. It also makes it very easy on your loved ones when the time comes.

Of course, you have to be careful who you chose as your Agent – or the one who will have this power. Clients need to think about who they would trust to take over this duty. You generally want to name several people for this purpose. Clients usually name one person, and then if that person cannot perform the duties, a second person, and then a third. These people can be your spouse, your grown children, or a brother or sister, but it should be someone that would take care of you anyway if anything ever happened to you. With this plan in place, they can step in immediately to help you.

Another thing to keep in mind is that this is a “Durable” Power of Attorney for Financial Affairs. That means that it stays in place even though you become incapacitated. This is a special power of attorney that is there for the express purpose of helping you when you are incapacitated. This power of attorney is also revocable and changeable at any time. If anything changes in the future, you can revise or cancel the document at any time.

Please call me with any questions you may have regarding this power of attorney at (925) 200-3936.