A Sacramento resident must decide for himself what estate planning documents he wants to execute to ensure that his affairs will be managed to his expectations in the event of his incapacitation or death. As such, readers are asked to speak with their estate planning attorneys about their needs rather than relying on this blog post as advice. It is offered for informational purposes only.
However, a durable power of attorney for financial affairs is an interesting grant of legal power. To answer the question posed in this post, whether a person needs one will depend on what financial matters the principal may need managed when he is incapacitated.
As discussed in a prior post on this estate planning law blog, attorneys in fact may perform the following and other tasks for their principals: paying bills and taxes, managing investments and benefits, making changes to savings and checking accounts, writing checks, transferring assets, and hiring legal representatives on the principals' behalf. A person who has not named an attorney in fact through a durable power of attorney may see his financial assets deplete if they are not managed during his incapacitation.
A durable power of attorney does not endure after the death of the principal. If the principal recovers from his incapacitation he returns to his life in control of his financial affairs; if he dies then his estate will be managed pursuant to the terms of his will, trusts, and other testamentary documents. His executor will handle the management and disposition of his assets according to his testamentary wishes and the laws of probate.
Many people benefit from having a durable power of attorney for financial affairs in place. Life is full of unexpected surprises, both good and bad. In the event that a person becomes unable to care for his own money and assets it can be extremely beneficial to have someone ready to step in and provide necessary management and support.