Durable Power of Attorney for Financial Affairs – Through this document, a person give legal power to an “attorney in fact” to step into their shoes to manage financial affairs. However, with an Estate Plan, all the main assets are held in the name of the Trust and thus managed by the owner of the Trust or his/her named successor Trustees, during any period of incapacity or incompetence and/or at death. Therefore, the main uses of a Financial Power of Attorney are to cash or deposit checks that come from outside the Trust or pay monthly bills on an interim basis. Thus a Financial Power of Attorney provides strictly limited powers, unlike most people presume.
It should also be noted that the document that is included with an Estate Plan is a Durable Power of Attorney. This document may be used when you are well and in charge of your finances (such as to have your attorney in fact pay a bill that comes due while you are “stuck” for an extra week in Hawaii – which typically does not happen) as well as when you are stuck in hospital ,incapacitated or incompetent (which is when you really need the help and typically for an extended period of time. (A “non-durable” or “regular” Power of Attorney is effective only when you are well, so that is why that document is not included in an Estate Plan