What Is a Durable Financial Power of Attorney, and What Does It Do?

Quick Answer

A Durable Financial Power of Attorney is a legal document that allows you to name someone you trust to handle certain financial matters on your behalf if needed.

Depending on the terms of the document, that person may be able to help manage things such as bills, banking, property, or other financial responsibilities.

At Hometown Senior Solutions, we use attorney-created estate planning documents and help clients complete the personal information those documents require. We are not attorneys, and we do not provide legal advice.

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What Does a Durable Financial Power of Attorney Actually Do?

A Durable Financial Power of Attorney allows you to choose someone you trust to act on your behalf in certain financial matters.

This can be especially important if you become unable to manage those responsibilities yourself.

Depending on the document and applicable law, the person you name may be able to help with things such as:

• Paying bills

• Managing bank accounts

• Handling certain financial transactions

• Dealing with property or financial paperwork

• Communicating with financial institutions

• Managing other financial responsibilities authorized by the document

The exact powers granted depend on the language of the document, so questions about what someone would or would not be allowed to do should be directed to an attorney.

Why Is a Durable Financial Power of Attorney Important?

Most people handle dozens of small financial responsibilities without thinking much about them.

Bills need to be paid.

Bank accounts need to be managed.

Forms need signatures.

Financial institutions may need someone legally authorized to speak or act on your behalf.

If you suddenly become unable to take care of those things yourself, your family may not automatically have the authority to step in.

A Durable Financial Power of Attorney gives you a way to choose who you trust ahead of time.

That can help reduce confusion, delays, and stress during an already difficult situation.

What Information Will I Need?

For our attorney-created Durable Financial Power of Attorney template, it is helpful to bring basic information for yourself and the people you may want to name.

That includes:

• Your full legal name

• Your current address

• The full name of the person you want to name as your primary agent

• Their address

• Their phone number

• The same information for any additional people you may want to name as backups

Our template includes space for a primary person and up to three additional people.

You do not need to have all four positions filled, but thinking about who you trust before your appointment can make the process easier.

How Is a Financial Power of Attorney Different From a Medical Power of Attorney?

They serve different purposes.

A Durable Financial Power of Attorney generally focuses on financial and property matters.

A Medical Power of Attorney generally focuses on healthcare decisions.

For example:

A financial agent may be involved in things like bills, banking, or financial paperwork.

A medical agent may be involved in healthcare decisions if you cannot make or communicate those decisions yourself.

Many people choose to have both documents because they address different parts of life.

Is a Financial Power of Attorney the Same as a Will?

No.

A will generally explains what you want to happen to your property and belongings after your death.

A Durable Financial Power of Attorney is generally used during your lifetime and allows someone you name to act on your behalf in certain financial matters.

They are separate documents with different purposes.

Who Are Our Durable Financial Power of Attorney Documents Best For?

Our attorney-created templates are generally best suited for people with relatively straightforward estate planning needs.

They may be a good fit for someone who:

• Wants to name a trusted person to help manage financial matters if needed

• Has relatively simple finances

• Does not own complicated business interests

• Does not have significant foreign property or foreign financial accounts

• Does not require customized trust or tax planning

• Has straightforward family circumstances

• Does not anticipate serious disputes about who should manage their affairs

There are situations where working directly with an estate planning attorney may be more appropriate.

That may include people with:

• Significant or complicated assets

• Business ownership

• Multiple properties or complex ownership structures

• Foreign assets or accounts

• Complex trusts

• Advanced tax-planning needs

• Complicated family relationships

• Concerns about financial abuse or family conflict

• Other circumstances requiring individualized legal advice

If your situation falls outside what our templates are designed to handle, we would rather tell you that and recommend that you work directly with an attorney.

Why Not Just Print a Free Financial Power of Attorney Online?

There are many free Power of Attorney forms available online.

The challenge is knowing whether the document you found is actually appropriate for your situation.

A random online form may leave you wondering:

• Who created it

• Whether it was written for your state

• Whether the language is current

• What powers you are actually granting

• Whether you completed the right sections

• Whether you followed the correct signing or witnessing requirements

A Financial Power of Attorney can grant someone significant authority, so it is not a document most people want to choose at random from a search result.

At Hometown Senior Solutions, the template we use was created by a local attorney.

We sit down with you and help you complete the personal information the document asks for, including the names and contact information of the people you want to designate.

That does not mean we are providing legal advice or telling you what powers you should grant.

It means you are working from an attorney-created document and have someone helping make the paperwork itself easier to navigate.

Is Hometown Senior Solutions a Law Firm?

No.

Hometown Senior Solutions is not a law firm, and our team members are not attorneys.

We do not provide legal advice, interpret the law, recommend legal strategies, or tell you who you should name as your agent.

The estate planning documents we use were created by a local attorney.

Our role is to help you complete the personal information requested in those templates and make the process easier to understand.

If you have questions about the powers granted in the document, how the law applies to your situation, or whether your circumstances require customized legal planning, you should speak directly with an attorney.

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Frequently Asked Questions

What does “durable” mean in a Durable Financial Power of Attorney?

Generally, “durable” means the document is designed so that the authority may continue even if you later become incapacitated.

The exact effect depends on the wording of the document and applicable law.

If you have questions about when the document becomes effective or how long authority lasts, speak with an attorney.

Who should I choose as my financial power of attorney?

Many people choose a spouse, adult child, close relative, or another person they trust.

Because this person may have access to important financial responsibilities, it is important to choose someone you trust to act carefully and responsibly.

Hometown Senior Solutions cannot tell you who you should choose.

Can I name more than one person?

Our attorney-created template includes space for a primary person and up to three additional people.

Those additional people may serve as backups depending on how the document is written.

Questions about whether people serve one at a time, together, or in another arrangement should be directed to an attorney.

Does the person I name have access to my money immediately?

That depends on the terms of the document.

Some powers of attorney may become effective immediately, while others may work differently depending on the language used and applicable law.

Because that is a legal interpretation of the document, questions about when authority begins should be directed to an attorney.

Can my financial power of attorney take money from my accounts?

A Financial Power of Attorney may give the person you name significant authority over certain financial matters.

The exact authority depends on the document.

That is one reason it is so important to choose someone you trust.

If you have concerns about the scope of authority being granted, speak with an attorney before signing.

Can my spouse automatically handle my finances if something happens to me?

Not always.

Marriage does not necessarily give a spouse automatic authority over every financial account, property matter, or legal transaction.

A Durable Financial Power of Attorney can formally identify who you want authorized to act on your behalf.

For advice about how this applies to your specific finances, speak with an attorney.

Can I name one of my children instead of my spouse?

Depending on the document and applicable law, you may be able to name an adult child or another trusted person.

The decision is personal, and Hometown Senior Solutions cannot recommend who you should appoint.

Can I change my Financial Power of Attorney later?

Powers of attorney can often be changed or revoked, but the proper process can depend on applicable law and your circumstances.

If you want to change an existing document, an attorney can help explain the correct steps.

Does a Financial Power of Attorney continue after I die?

Generally, a Power of Attorney is intended to operate during your lifetime and ends at death.

After death, responsibilities may shift to the person handling your estate under your will or through the probate process.

For questions about your specific documents, speak with an attorney.

Is a Financial Power of Attorney only for seniors?

No.

Adults of many ages may choose to have one.

An unexpected illness, accident, or other event can make it difficult for someone to handle financial responsibilities regardless of age.

Do I need both a Financial Power of Attorney and a Medical Power of Attorney?

They serve different purposes.

A Financial Power of Attorney generally deals with money, property, and financial responsibilities.

A Medical Power of Attorney generally deals with healthcare decisions.

Many people choose to have both so that each area is addressed.

Does having a Power of Attorney mean I lose control of my finances?

Not necessarily.

Creating a Power of Attorney does not automatically mean you are giving up your ability to handle your own finances.

How and when another person may act depends on the terms of the document.

Questions about the exact legal effect of the document should be directed to an attorney.

Do banks have to accept a Financial Power of Attorney?

Financial institutions may have their own procedures for reviewing and accepting Power of Attorney documents.

There can also be legal requirements affecting whether a document is accepted.

If you have concerns about a particular bank or account, you may want to speak with the institution or an attorney.

Should the person I name know that I have chosen them?

It is generally a good idea to talk with the person ahead of time.

They should understand that you are considering giving them an important responsibility and have an opportunity to ask questions.

Is an online Financial Power of Attorney legally valid?

An online or downloaded Power of Attorney may be valid in some circumstances if it meets all applicable legal requirements.

The challenge is knowing whether the form is appropriate for your state and situation and whether it has been completed and executed correctly.

At Hometown Senior Solutions, we use a template created by a local attorney rather than relying on a random form found online.

We are not attorneys and do not provide legal advice, but we can help make completing the attorney-created template easier to navigate.

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You Don't Have to Figure It Out Alone

A Durable Financial Power of Attorney is ultimately about making one important decision ahead of time:

Who do you trust to help handle financial responsibilities if you cannot do it yourself?

You do not need to understand every legal term before scheduling an appointment.

It is helpful to think about the people you trust and have their basic contact information handy. We can help you work through the personal information requested in the attorney-created template.

Ready to take the next step?

Schedule an estate planning appointment with Hometown Senior Solutions to see whether our attorney-created documents may be a good fit for your situation.