What is a California Durable Power of Attorney?
A California Durable Power of Attorney is a document that authorizes your agent (a person you choose) to manage your financial affairs if you become unable (or unwilling) to manage them yourself.
Selecting your Durable Power of Attorney Agent
When you sign a general power of attorney, you authorize someone to manage financial matters on your behalf in the event that you are unable to do so yourself. That’s a lot of responsibility to sign over to someone. You need to pick someone who is trustworthy, someone who will act in your best interests. But you also want to choose someone to can handle the responsibility of managing the assets you’ve accumulated during your life. You wouldn’t ask your 20-year-old child to run your crop-dusting business, would you? As you discuss your choice with your family, refer back to the bullet list on the left side of this page to guide the decision process.
Choose someone you’d trust with your checkbook
Questions to Ask when choosing an Agent
- Who will best be able to handle the responsibility?
- Who is local?
- Who do you trust with your finances?
- Who will be caring for you physically?
- Who is best suited to the required tasks?
- Who will be alive when they are needed?
- Who could act as an alternate if needed?
SOME FAMILY CONSIDERATIONS
Obviously, you need to appoint someone you trust. Typically, the first person you turn to is your spouse. This is a great choice as primary power of attorney in most situations, but what if your spouse can’t do it? Most often, people choose another family member, like a child or a sibling. But before you just assign the duties to your oldest child, consider whether that child has the knowledge and experience necessary to manage your affairs. Is a graphic designer the best choice to manage a farm operation? Would you trust your nest egg to a college senior? It’s smart to choose someone you’d trust with your checkbook.
Let’s be Practical
In the grand scheme of things, convenience is going to play a major role in deciding who should act as your power of attorney. On one hand, it might make your five children feel good to all be appointed together as your agent. On the other hand, is it wise to make the child who lives in the same town as you call her older sisters who live in Century City, Cleveland, and Beijing every time she needs to make a decision? Consider whether the better option is to appoint one child or sibling as the primary agent and appoint the others as alternates.
By law, a power of attorney (POA) ceases to be valid when the concerned individual is incapacitated. However, in most cases, this law nullifies the purpose of having a power of attorney in place and for the same reason, the POA must be explicitly stated as “durable”.
Life can turn on a dime and drastic changes can occur overnight in anyone’s life. If you have a durable power of attorney in place, potential squabbles over your financial as well as health care matters can be resolved easily. All that you need is a reliable estate planning attorney to draft your durable POA document.
A California Durable Power of Attorney Protects the Assets of the Principal
When a patient is forced to move into a nursing care for health reasons, the assets of the individual can be best protected through a durable power of attorney. Ignoring the need for a durable POA can result in your property being subjected to nursing home care payments.
Make important decisions along with the agent
A durable power of attorney gives you the incredible opportunity to make the most important financial decisions prior to incapacity. While this may sound simple, remember that without a durable POA, the court will appoint a guardian to handle all your affairs (which is a more expensive option and takes a lot of time to be executed too).
Steps to Cancel a Financial Power of Attorney
Canceling a power of attorney is pretty straight forward. Still, it needs to be done properly with careful planning so that it cannot be disputed in the future. The best possible outcome is that the principal, who granted the power to the attorney-in-fact to act in their name, effectively cancels it. But if the principal does not revoke the power of attorney prior to becoming incapacitated, then revoking a power of attorney would require court proceedings. If the principal dies, however, the POA is automatically revoked. Here are the steps to revoke the California financial power of attorney:
- A written document must be drafted invalidating the current power of attorney. We recommend hiring an attorney for this process as they are well-experienced and would ensure that the revocation document is valid.
- According to the California law, the revocation must follow the requirements shown on the original power of attorney. Check the original document to make sure that all the requirements are fulfilled.
- Sign the document in the presence of a notary.
- A copy of the signed revocation document should be sent to the agent and all the third parties involved in the original POA process.
- The revocation can either be delivered directly or via certified mail. Getting a return receipt would act as a proof that the document reached all the parties.
- Certain California jurisdictions require that the revocation to be sent for a local publication as an added protection to safeguard its authenticity.
If you have any questions on setting up a California Durable Power of Attorney feel free to reach out to one of our experienced California Estate Planning Attorneys.