In this episode, Tim talks about he the role and importance of a Power of Attorney.
Podcast Transcription:
WRVO Producer Mark Lavonier:
This podcast is part of the series Estate Planning Pro Tips, hosted by attorney Tim Crisafulli of Crisafulli Estate Planning and Elder Law, P.C. An estate planning, probate, and elder law firm serving clients throughout Central New York. A former school teacher, Tim explains complex legal subjects in an easy-to-understand way. The commentaries focus on essential aspects of estate planning, such as wills, trusts, asset protection, long-term care, and probate. And now here's Tim.
Tim Crisafulli:
If a person loses capacity, who is authorized to execute documents on behalf of that person? If a person develops dementia, is incapacitated, or in a car accident, or is otherwise unable to execute documents and control transactions, someone needs to be able to act on behalf of that person.
A power of attorney is a document that designates the person or people who can act on behalf of someone else for all things financial, such as bank transactions, applying for government benefits, and selling property.
It is important to note, however, that not all health care power of attorney documents are created the same. Some are too strong. They give the appointed agent too much authority to make gifts, spend money, and reorganize an individual's finances. Many are too weak. When a crisis hits, a power of attorney document that is too weak might not enable an agent to complete all transactions necessary to advocate for an incapacitated person's well-being. It's important to get these documents just right.
It is also important to note that there is always a default. If ever an individual loses the ability to manage their own finances, and if there is no power of attorney in place, then the family must seek a legal guardianship. Legal guardianships are expensive, emotionally draining proceedings. They call upon a court to find an individual no longer capable of making decisions, to articulate the specific tasks with which help is needed, and to choose a guardian. Deciding who should serve in that role can create family-destroying conflicts. In the end, a quality power of attorney is a vital tool to avoid a guardianship and a family catastrophe.
