Page 11 - Means Wealth 2020/2021 Perspectives

THE VALUE OF A FINANCIAL POWER OF ATTORNEY

or the vast majority of people, appointing a financial power of attorney
F (POA) can be a very morbid and depressing thought. Who wants to think
about physical or mental incapacitation? The fact is it is extremely important
to have a financial POA. This instrument is a legal document that allows an
individual/principal the ability to designate a trusted person to take over
their finances if they become incapacitated.
The following are examples of actions that a financial POA may be able to
take on your behalf:
– Access financial accounts to pay certain bills,
“
– File taxes,
Worry is like a rocking chair;
– Make investment decisions,

– Distribute gifts of money, and it gives you something to do
but never gets you anywhere.
– Recommend a guardian. – Erma Bombeck “

There are basically four types of POAs:

1. General POA — performs almost any act such as opening financial
accounts and managing personal finances. This instrument is
terminated if the principal revokes the POA, becomes incapacitated or
passes away.
2. Durable POA — acts on the principal’s behalf and includes a durable
clause that maintains the POA after the principal becomes incapacitated.
3. Limited or Special POA — performs specific duties limited to a certain
area, like selling a camp, cottage or summer home.
4. Springing Durable POA — becomes effective when a specific event
occurs such as the principal becomes incapacitated.
You also may want to consider creating an Advance Health Care Directive,
appointing an agent to make healthcare decisions such as consent to
giving, withholding or ceasing medical treatments, services or diagnostic
procedures. This person may or may not be a different individual than the
one making your financial decisions.

These can be difficult discussions to have with loved ones. We want to
think of our loved ones as invincible but, as the saying goes, death and
taxes are inevitable. n

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