Whether it be due to a medical condition or simply a result of getting older, there may come a day when you are no longer able to make decisions for yourself. In case that day comes, experts recommend choosing a trustworthy and responsible person to make financial decisions on your behalf. You can assign them responsibilities during the estate planning process by signing a financial power of attorney (POA).
Choosing an agent for your financial POA
In New Jersey, you can choose any adult (18 or older) to serve as your agent for your financial POA. Experts advise choosing one agent, as well as a backup agent to step in if your chosen agent is unavailable or unwilling to serve.
Types of POA
There are multiple types of financial POAs available for you to choose from. A durable POA will go into effect as soon as you sign it in front of a notary (while mentally competent) and will last until one of the following things happen:
- You pass away
- You revoke it while still mentally competent
- Your agent resigns
- An agent is not available
- The court declares the document invalid
A springing POA will not go into effect until you, as the principal, become incapacitated. If you choose a springing POA, you should clearly detail when it will go into effect.
A non-durable/general POA goes into effect immediately but will end when the principal becomes incompetent.
Responsibilities of financial POA agent
Before choosing an agent, you should consider what their responsibilities will be. Some of their main responsibilities include:
- Managing principal’s living expenses and benefits (e.g., Medicare)
- Handling financial transactions (e.g., withdrawals or deposits)
- Paying bills and taxes
- Managing property
- Handling investments
Your agent is legally obligated to put their own interests aside and do what is best for you as the principal. They must act honestly and keep accurate records of all transactions. If you need help choosing a financial POA, you should consider meeting with an estate planning attorney.