There is no substitute for a valid POA.
On Tuesday, March 24, CGA’s estate attorneys participated in a Canon series teleconference, co-sponsored by our friends at ACNB Bank, outlining the very latest legal guidance on that most important of estate documents, the durable power of attorney (“POA”). The following are notes from that seminar.
1. Irreplaceable.A POA allows us to appoint a trusted person like a spouse, parent, child, or other family member to help and assist us with decisions if we are unable to take action on our own. There is really no substitute for a valid POA; without one, family members must resort to the lengthy and expensive process of a court guardianship to take action. A POA is much more effective and much less expensive!
2. For now, and for later. Most POAs are intended to take effect immediately, while I am still able to take action on my own, with the intent that it will be effective later when through accident or injury, I am unable to take action on my own. Clients are sometimes concerned that an agent could use the document now, before I am ready, and only want the document to “spring” into effect upon my incapacity. But if I can’t trust my agent to take appropriate actions now, while I can supervise him, th
3. The right person.It is essential to choose the right agent. It should be someone capable, knowledgeable of my intentions, and above all else, trustworthy. In my document, I can name a spouse to act now; a child to act if my spouse becomes unable or unwilling to act; or more than one family member or agent to act, together or independently. A good document will be flexible enough to meet changing circumstances, IF we have the right agent.
4. Strong Powers. While a POA agent is a fiduciary with
5. Your Will is not enough. It is also essential to have a comprehensive Estate Planning package, and with only a Will in place, but no POAs, one is left without full protection – this includes not only the durable POA but also the living Will, aka the healthcare POA. For example, a durable POA agent can pay the mortgage and taxes during a time of my unavailability or incapacitation. Without a POA, my mortgage won’t get paid, and one of my Estate’s biggest assets may be encumbered with arrearages, or worse, lost to Sheriff’s Sale or tax sale. If there is no POA to manage finances after my incapacitation, late bills and creditor claims could eat up the value of my Estate, leaving my loved ones with little or nothing. Even if I had a life insurance policy designating a beneficiary outside of my Will, if I have not designated a POA agent to ensure the premiums are paid, that policy can be lost. In the event of a business owner becoming unavailable or incapacitated, the POA agent can run the business and keep it alive, thereby preserving the interest and income from that business. Just having a Will is not enough!
In uncertain times like the present emergency, it is more important than ever that each of us has a valid power of attorney in place, to protect ourselves and our families. If you need assistance, please reach out to the CGA Law Firm. We’re here for you!
— Attorney Rohrbaugh is an associate at CGA providing assistance to clients in Estate Planning and Administration, Business Formation and Representation, Workouts, and Bankruptcy, as well as other legal needs. Reach her at [email protected] or 717.848.4900 extension 136.