Can a Power of Attorney Create a Will?

By Laura Wallace Henderson

Planning for your future includes considering the possibility of your incapacitation. A legal document, known as a power of attorney, allows you to designate one or more individuals to take care of a variety of responsibilities if you are unavailable or incapable of performing these on your own. The details you include in your power of attorney document will help define the responsibilities and limitations this written instrument allows.

Planning for your future includes considering the possibility of your incapacitation. A legal document, known as a power of attorney, allows you to designate one or more individuals to take care of a variety of responsibilities if you are unavailable or incapable of performing these on your own. The details you include in your power of attorney document will help define the responsibilities and limitations this written instrument allows.

Wills

Your will allows you to provide instructions regarding your assets. This document may provide a variety of instructions including the division of personal property such as real estate, cash, personal belongings and stocks. Although the agent you list in your power of attorney may perform a variety of tasks, your agent can’t create or change your will. A power of attorney ends upon your death; a power of attorney document is not a substitute for a will.

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Powers of Attorney

You can use a power of attorney for a variety of purposes. This document designates an agent, or attorney-in-fact, to perform certain tasks such as buying and selling property, filing your tax returns, managing your bank accounts and signing contracts. You can choose what tasks you allow your agent to perform, as well as provide a time limit for the effective term.

Limitations

As in other areas of estate planning, state laws may vary in the ways they govern an agent’s actions. While your agent cannot create or revise your will, some jurisdictions allow your agent to create or amend trusts while you are living. Your agent may also have the authority to transfer money into your trust.

Considerations

When drawing up a power of attorney, choose your agent carefully. The responsibility you give to your agent depends on your individual wishes. Clearly define what responsibilities you want your designated agent to complete, as well as providing clear instructions on the limitations you wish to impose. Some individuals choose to elect more than one agent, sometimes listing their children or closest friend and attorney to co-manage the decisions. While electing more than one agent may allow several individuals to share the responsibilities, this action can also lead to conflicts if the agents disagree on necessary procedures and actions.

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What Should Be in a Power of Attorney?

References

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What Can Happen if You Don't Have a Power of Attorney?

If you suddenly became unable to handle your own finances or make your own health care choices, a person you appointed in a power of attorney -- your agent -- could make decisions for you and take care of your financial affairs. Without a power of attorney, however, your family may have to go to court to obtain permission to manage these areas of your life when you are no longer able to.

How to Set Up Enduring Power of Attorney

If you are worried about what will happen to your assets and affairs should you become incapacitated, setting up an enduring power of attorney may ease your fears. An enduring power of attorney – referred to as a “durable” power of attorney in the United States – is a document granting another individual the right to handle certain financial or medical decisions on your behalf. A durable power of attorney differs from a standard power of attorney in that your representation, known as your “agent” or "attorney-in-fact" does not lose his right to manage your affairs should you become mentally incompetent. While an attorney can provide you with helpful information when completing this process, an attorney is not necessary to set up and execute a durable power of attorney. You can complete the documentation on your own, or use an online document preparation website.

How to Gain Access to Bank Accounts With a Power of Attorney

When you aren’t able to manage your bank accounts, a power of attorney can help. A power of attorney document lets you name someone else, known as your agent, to act on your behalf. You can create a power of attorney authorizing your agent to access your bank account or take other actions with your bank. However, policies differ among banks and state laws vary regarding powers of attorney.

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