Estate planning can be more complex than simply drafting a will. In California, people may choose to grant legal authority to a trusted individual to manage their business and financial affairs. This is typically accomplished through a power of attorney document. The designated attorney-in-fact holds significant power and can act on behalf of the grantor in various capacities. Therefore, it is crucial to carefully consider and make a wise decision when selecting an attorney-in-fact.
Choosing an attorney-in-fact
When a grantor designates an attorney-in-fact, they are granting them the power to sign contracts, withdraw funds from bank accounts, interact with tax agencies, access safety deposit boxes and perform other tasks. However, an attorney-in-fact who lacks competence or ethics could cause significant financial damage to the grantor. Therefore, carefully selecting the most suitable person for the role is wise.
An attorney-in-fact needs to clearly understand the various duties and responsibilities expected of them to handle. Choosing an incompetent relative to fulfill this role could lead to financial disasters. Additionally, while any responsible person can be given the power of attorney authority, they may not always carry out the requested duties. Therefore, making a wise selection for an attorney-in-fact is highly recommended.
Points about power of attorney documents
Granters may choose to issue a limited power of attorney to protect themselves. Such a document can restrict the attorney-in-fact’s actions and may even come with an expiration date. In some instances, granters may be wise to limit the scope of the power of attorney. Taking deliberate steps during the estate planning process may result in drafting an appropriate power of attorney form.
The grantor may revoke power of attorney authority if necessary. Keeping tabs on an attorney-in-fact’s behavior seems advisable if possible. If the attorney-in-fact fails to perform as required, revoking their authority could be the right move.