A Durable Power of Attorney also becomes effective immediately upon signing, however it allows the Agent to continue acting on behalf of the Principal even when he or she becomes incapacitated. This type ends automatically when you die, but you can also rescind it, as long you are not incapacitated.
If you take the time to create a Power of Attorney, you want to make sure that it will be effective. There are situations where your document may be rejected, or powerless if you aren’t careful. Here are a few steps you can take to help ensure your POA won’t be powerless:
- Use a state-specific form – Each state has different laws and statutes governing this document. Our state-specific forms are customized for each particular state.
- Make sure you have all signatures and authorizations – Some banks and financial institutions have specific requirements as to who needs to sign the document.
- Keep it up-to-date – If your state has rewritten its laws or your document is more than several years, it may be considered ‘stale’ and may need to be updated.
- Get it witnessed and notarized – Sign your document in front of witnesses, stating that you were competent and signed the document voluntarily. Also make sure to get your document authenticated by a notary public.
In addition, if you ever become incapacitated, without this document, even if you have a spouse, the court may need to step in and appoint a guardian or conservator for you. The process of appointing a guardian is costly and requires the guardian to formally report your situation to the court each year. CNN Money estimates that the process of obtaining a court appointed guardian exceeds $1,000. If this is the situation you find yourself in now, please read our guide about getting guardianship over your elderly parent here.
Power of attorney, also referred to as a POA, is a legal document that allows a person (principal) to choose someone else (agent or attorney-in-fact) to represent their financial, medical, tax, vehicle, parental, or any other needs selected. The document does not need an attorney to create (although it is always advised that a person seek legal counsel) and after completion, depending on the State, signatures need to be witnessed by at least two (2) people or by a notary public (preferred).