You never know what will happen in life since accidents and illnesses occur unexpectedly.
If you suddenly become incapacitated, having a power of attorney for finances will provide the financial help you need and the comfort your family members need.
What it is
A financial power of attorney (POA) is a document that allows the person of your choosing to manage legal and financial affairs on your behalf. This POA is especially useful if you should become incapacitated. You can appoint a trustworthy family member or friend as your agent to step in and handle everything from paying your bills and filing taxes to making investment decisions for you.
How it helps
In addition to enabling your agent to step in if you become incapacitated due to an accident or illness, the POA for finances can be an essential tool for day-to-day needs. For example, if you are a senior, you may want someone to help you make certain financial decisions, ensure that you are receiving government benefits properly, or even just balance your checkbook.
When to prepare
With aging comes the potential for some level of dementia. Often, physicians will not provide a dementia diagnosis until a condition involving cognitive decline is well underway. In terms of estate planning, you should prepare well in advance of that possibility. If you are not mentally competent, you cannot sign a power of attorney. For this reason alone, it is essential that you create your financial POA sooner rather than later. Once executed, this important document will provide you and your family with peace of mind.