#TuesdayTips: Financial Powers of Attorney – To Be or Not to Be?

The purpose of most powers of attorney is to authorize your named agent to act on your behalf when you are incompetent or unable to make decisions yourself.  So, if your plan is to wait until you need the power of attorney before talking to your named agent, likely, it is too late.   

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That is a valid question.  One that is not pondered enough and often results in a family member being thrown into a position of great responsibility without any direction or idea how they are to act or what they are to do.  In fact, most people sign power of attorney documents naming someone, but then never tell them or have a conversation with that person about what will be expected of them.

Instead, they leave the attorney’s office feeling relieved that they have a plan in place in the event something happens to them, and as soon as they get home, shove those documents into a filing cabinet, drawer or safe (not even telling anyone where they are located), knowing that when the time comes, they will let the named individual know.  Except, the purpose of most powers of attorney is to authorize your named agent to act on your behalf when you are incompetent or unable to make decisions yourself.  So, if your plan is to wait until you need the power of attorney before talking to your named agent, likely, it is too late.

The conversation needs to happen before naming anyone as your power of attorney so you can pick the right individual for the job (and it is a job, make no mistake).  Generally, a financial power of attorney authorizes your agent to manage your finances, and specifically itemizes everything your agent is allowed to do on your behalf.  However, a power of attorney does not list your assets or provide instructions regarding how those assets should be managed.  Only you know that.

 

Thus, it is imperative that you let your agent know about every asset you own – real estate, personal property, bank accounts, mutual funds, stocks, bonds, life insurance policies, retirement accounts, trusts, etc.  Where the assets are located, what company or institution holds them, how they are titled, and their values also should be disclosed to your agent.  Your agent should also know your sources of income and when you receive your income so they can pay bills accordingly.

Additionally, you should tell your agent what your wishes are in the event you require long-term care.  Do you want your assets used to keep you at home, or would you want them preserved for your beneficiaries?  Either way, your agent will be in charge and if assets need to be liquidated, are there certain assets that he or she should liquidate first?  These and many more decisions should be made and discussed with your power of attorney.

Being a financial power of attorney requires a lot of organization, work and time.  It is a commitment that cannot be taken too lightly.  You should choose a power of attorney that is trustworthy and has the time available to devote to managing your assets.  And please, make sure your power of attorney knows what you have and what you want done with it.  Call ERA Law Group, LLC today at (410) 919-1790!

 

#FamilyFriday – Prenuptial Agreements: Why You Should Get One!

There are two ways to dissolve a marriage: divorce and death. Prenuptial agreements help in making the dissolution as easy as possible.

There is a misconceived notion that asking for a prenuptial agreement or discussing it in some way implies distrust or concern over your relationship.  This isn’t true!  There are a significant number of benefits to obtaining a prenuptial agreement that the attorneys at ERA Law Group, LLC want to bring to your attention for this week’s #FamilyFriday article!

Marriage is both a romantic and business relationship.  With very few exceptions nearly everything is or becomes marital.  As such, nearly everything can become subject of costly litigation in the event of divorce or death.  A well drafted and all-inclusive premarital agreement will limit many of these issues.  For example, the agreement will identify what is and is not marital property, each parties’ rights in the event of death or divorce, predetermine rights and obligations for spousal support, inheritance, and more.  In addition, the agreement will have a complete financial disclosure including each spouses’ assets, liabilities, and income.

There are two ways to dissolve a marriage: divorce and death.  Prenuptial agreements help in making the dissolution as easy as possible.  Prospective spouses should consider whether they want to be on the hook for their partner’s debt in the event of divorce or marriage?  Whether they want their spouse from a second marriage to inherit more than their children from their first marriage?  Whether they want their private business to be impacted in the event of divorce or death?

Why wait?  Protect you, your spouse, and your family no matter what life throws at you.  Call ERA Law Group, LLC today at (443) 906-3566!