When Should Your Power of Attorney Take Effect?

In prior articles, we have discussed powers of attorney and the need for persons to have one. In this article we will talk about one option that needs to be considered when preparing a power of attorney, namely, when should your power of attorney take effect?

The power of attorney can take effect either immediately upon your signing it or it can take effect only upon you becoming unable to handle your own affairs. Which is right for you?

If you are appointing your spouse to act on your behalf, then it would make sense to allow your spouse to have the power to act on your behalf immediately, because in most cases you and your spouse have joint accounts and assets anyway. However, if you are appointing one of your children or another person to act for you, then do you want them to act for you while you are still capable of acting on your own? Or would you want your children or other person to act only if you are not capable of handling your affairs? The answers will depend on your individual circumstances. If you are capable of handling your own affairs, you may not want another person to have that control until such time as when you are determined not to be able to handle your own affairs. On the other hand, you may want the person to act on your behalf even if you are still capable of handling your affairs. For example, you may already have a child or other person handling your affairs for you. You may wish to continue to allow that person to handle your affairs even if you can handle those matters yourself. In such a case, you would want your power of attorney to take effect immediately.

It is a common misconception that in making a power of attorney that takes effect immediately, you give up the right to make your own decisions. This is not the case. You should be aware that making a power of attorney does not give away to another person the right to make your own decisions. What it allows is for that person to make decisions alongside of you. What happens if that person makes decisions that are contrary to what you would want? In that case you have the right to revoke the power of attorney and take away their right to handle your affairs.

If you decide that you do not want your power of attorney to take effect immediately, when should it take effect? Usually it will take effect upon your being declared “disabled.” The term “disabled” usually refers to the mental inability to make your own decisions as opposed to being physically disabled. In powers of attorney prepared by our office that usually means a determination and written opinions by two doctors as to your disability.

The decision as to when your power of attorney should take effect is one that you should discuss with your attorney.

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