People often think of a power of attorney (POA) as something they can use to have a realtor finish a real estate transaction on their behalf or as part of a living will. POAs can be used those ways–and are valuable for those situations–but they can also be used to protect your assets should you suddenly become incapacitated. Read on to learn more.

What Type of POA Protects Assets?

There are several different types of POAs, and the one that someone wants to protect them if they become incapacitated is a durable power of attorney. This POA is meant to address financial concerns by allowing someone else (called an attorney in fact) to make decisions and handle business and financial concerns while the person who drew up the POA is incapacitated.

Suppose someone doesn’t have this type of POA and becomes incapacitated. In that case, the court may have to intervene to appoint a guardian or conservator to handle the business and financial concerns of the incapacitated person. The court process for this can take ample time, meaning financial decisions won’t be made on a timely basis. It can also be quite costly. In contrast, having a durable power of attorney means that as soon as someone becomes incapacitated, the person named the POA can begin handling their financial affairs.

What Is Incapacity?

  • When incapacitated, someone can no longer handle or make decisions about their finances (or healthcare). That could be a situation where someone is in a coma or has suffered a traumatic brain injury that’s disrupted their ability to think clearly and rationally. Incapacitation can be short-term, or it can last for a considerable period of time.

Do I Need an Attorney to Set up a POA?

Technically, anyone 18 years or older, a resident of Georgia, and mentally competent can create their own POA. However, if family members are opposed to the person chosen to be the POA if the POA isn’t legally and soundly drawn up, they may have a case to contest it. Working with an experienced estate planning attorney can help ensure the POA is correctly drawn up and enforceable.

How Do I Choose the Person to Be My Attorney in Fact in the POA?

In Georgia, the only requirements are that the person is at least 18 years old and legally competent. But this is an important document that potentially assigns a large amount of authority to someone else, so taking time to consider who’s the best person for that role is worthwhile. It’s often a spouse, another family member, or a close friend. Here are considerations for choosing your representative.

  • Trust. This is of the utmost importance. Regardless of what exactly is covered in your POA, the person who will handle it needs to be someone you trust to be honest and to abide by your wishes, no matter what their opinion of the situation will be.
  • Advocate. The person you choose may have to stand up for your wishes against the wishes of others, including family members or business associates who want things done differently. It’s important to have an assertive and not easily swayed POA.
  • Local. Technically, the person acting as your POA doesn’t need to be local. But because financial or business transactions could require them to be physically present at times, it’s more convenient for everyone involved if they live locally.
  • Detail-oriented. You want someone who is savvy about working with details and will scrutinize every transaction as carefully as if it was their own.
  • Financially sound. Even if this is someone you’re close to and have a good relationship with, think twice about asking them to represent your financial interests if they’re not good with their own finances. The temptations involved are risky.
  • +Willing. It’s vital that you have an open, extended conversation with the person you want to list on your POA so they understand what would be expected of them and how much work it might be. If they’re not willing, don’t try to convince them. Move on to someone else. Even if they agree, it’s a good idea to return to the conversation periodically to ensure nothing has changed.

Once I’ve Named My POA, Can I Change My Mind?

Yes. This is not set in stone. If circumstances change (you named your spouse, but now you’re divorcing), not only can you change the person who would represent you, should change them. There are many reasons why someone would want to change their POA, including loss of trust, fallings-out, change in family circumstances, and changes in financial circumstances, among others.

To change your POA, have your attorney help you fill out a Georgia revocation power of attorney form. It details who the original POA was, what their authority was, and your wish to remove them.

This form must be notarized and a copy provided to the person being revoked. If they don’t receive the form, they can legally claim they weren’t informed of the change and still expect to be legally responsible for your finances. Also keep a copy of the revocation form in a safe place and inform those you trust most.

What Should I Do if I Need to Set up a POA?

Call Lunn Law LLC as soon as possible at 770-762-4628 to set up a case assessment. Our experienced, knowledgeable estate planning attorneys can help determine the best approach to protect your assets in case you ever become incapacitated. Obviously, the hope is that you’d never need to use it, but having one ready just in case can provide peace of mind. It can also prevent those that matter most to you from being more stressed in an already stressful time.