In case they become unexpectedly incapacitated, Colorado residents should have certain provisions in place to ensure that their financial affairs will be properly managed. This entails having a power of attorney as part of their estate plan.
A power of attorney is a legal document that gives an individual the legal authority to act or make decisions on the behalf of someone else. As the agent or attorney-in-fact, and depending on the type of power of attorney that is completed, the individual will have the power to file tax returns or manage financial business accounts.
A durable power of attorney may be more appropriate than a nondurable power of attorney in most cases. A nondurable power of attorney becomes invalid if the principal is no longer able to make decisions on his or her own behalf. However, a durable power of attorney is still effective if the principal becomes incapacitated.
Only a trusted friend or relative should be chosen as the attorney-in-fact. More than one person can receive the designation if there are qualms about allowing a single individual to have so much authority over financial matters.People wanting this type of a document should also make sure to use an attorney who has a strong background in estate planning. The attorney shoul review the document regularly in event of life changes.
Individuals who have concerns about the welfare of their family when they are unable to make decisions on their own behalf and after their death should speak with an estate planning attorney. Legal counsel can often suggest other tools that could be appropriate for a client's particular situation.