When Illinois residents are thinking about their estate planning needs, they will generally focus on the basics, like wills and trusts. There are other aspects to an estate plan, but it is important to tailor the documents to the individual’s needs. For those who are in a situation in which they might need a power of attorney, it is imperative to understand various critical points about such a document.
There is significant influence for the person who is granted power of attorney. When naming a person, he or she will be known as the “agent” or the “attorney-in-fact.” That individual will make financial decisions in the person’s stead. They control the assets in bank accounts and other financial vehicles in the person’s name. When selecting a power of attorney, there are generally two options: a durable power of attorney or a springing power of attorney. Durable powers of attorney go into effect when they are signed and will remain as such while the person is incapacitated. The springing power of attorney is in effect once the person becomes incapacitated.
Picking a trustworthy person is essential. A person granted power of attorney can change the ownership of assets and other aspects of the estate plan. Some people decide that it is preferable to have two agents who will act in tandem.
Having an alternate power of attorney can be useful as a protective device if the original person dies. An understated aspect of a power of attorney is to make sure to read it. It might appear to be a simple decision that everyone will follow, but people can place too much trust in others and fail to read the document to know what it says. Once the person dies, the power of attorney is no longer applicable.
People who are concerned about being incapacitated and unable to handle their own affairs can benefit from a power of attorney. Before naming someone as power of attorney or taking other steps with estate planning, it can help to get more information about the available options.