When you think about estate planning, do you think about powers of attorney? Have you considered what would happen to your financial affairs if you became incapacitated?
Many people plan for what will happen when they die, but not everyone considers what would happen if they were unable to make decisions for themselves. Anybody can become incapacitated at any time, for example from a serious accident or a sudden disease.
It is in your best interest to plan for this possibility ahead of time. Think about who you trust to handle your financial affairs if you aren’t able to make decisions for yourself. You could even divide your financial responsibilities among a few different people if you didn’t want one person to do everything, or you could limit your agent to just a few financial tasks.
Here is a list of a few things that might need to be taken care of if you became incapacitated. Which ones would you want your agent to handle on your behalf? You can include these specifics in a durable financial power of attorney:
- Use your bank accounts or other assets to pay your expenses or your family’s expenses
- Collect your Social Security, Medicare, or other government benefits
- Collect your retirement payments or manage your retirement accounts
- Make investment decisions for you (i.e. buy or sell stocks or bonds)
- Buy or sell real estate or other property
- Buy or sell insurance policies
- File and pay your taxes or collect your tax refund
- Claim property that you inherit
Read more about durable financial powers of attorney in our law library article “The importance of a durable financial power of attorney” and “Protect Yourself with a Durable Power of Attorney.”