What is a California Durable Power of Attorney?
A CA durable power of attoreney is similar to a healthcare power of attorney, however, it only relates to financial decisions and does not have any control over healthcare decisions.
In setting one up you may want to talk to an estate planning lawyer or an elder law attorney.
Selecting your California Durable Power of Attorney Agent
When you sign a general power of attorney for finance, 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 our estate planning checklist to make sure you cover all your bases and will avoid probate.
Questions to Ask When Choosing a California Durable Power of Attorney Agent
Who will best be able to handle the responsibility of acting as an agent? Here are some questions to ask yourself:
- 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 WHEN CHOOSING A CALIFORNIA DURABLE POWER OF ATTORNEY AGENT
Obviously, you need to appoint someone you trust. Typically, the first person you turn to is your spouse.
This is a great choice as the primary power of attorney agent 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.
Dealing with financial decisions is not easy. 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 to keep your assets out of the probate court.
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”.
A durable power of attorney remains in effect even after you are mentally incapable of making your own healthcare or financial decision.
We recommend having a durable power of attorney for health care (aka an Advance Health Care Directive), a durable financial power of attorney, and a revocable living trust to ensure optimal management of your health as well as your assets.
If you are not sure what you need, try taking our estate planning quiz.
Drafting a valid California Durable Power of Attorney Avoids ambiguity
Life can turn on a dime and drastic changes can occur overnight in anyone’s life. If you have a California durable power of attorney in place, potential squabbles over your finances, 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 as part of your comprehensive estate plan.
A California Durable Power of Attorney is Designed to Protect the Assets of the Principal.
When a patient is forced to move into 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 California durable power of attorney agent
A California durable power of attorney gives you the incredible opportunity to make the most important decisions regarding financial and medical matters 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).
6-Steps to Cancel a California Durable Financial Power of Attorney
Canceling a California durable power of attorney is pretty straightforward. 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 probate 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 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 proof that the document reached all the parties.
- Certain California jurisdictions require that the revocation be sent for a local publication as an added protection to safeguard its authenticity.
DPOA vs POA
A Power of Attorney (POA) and a Durable Power of Attorney (DPOA) are both legal documents that grant someone the authority to act on another person’s behalf in legal matters. The main difference between the two lies in their durability or continuation of effect.
A standard POA automatically becomes invalid if the person who made it (the principal) becomes mentally incapacitated. On the other hand, a Durable Power of Attorney remains in effect even if the principal becomes mentally incapacitated. This difference is crucial when planning for circumstances where the principal might not be able to make decisions for themselves, such as in cases of serious illness or injury.
So, what does power of attorney mean? It means taking action so that someone can act on your behalf in the event you are unable to and make financial and legal decisions
If you have any questions on setting up a California Durable Power of Attorney document feel free to reach out to one of our experienced San Diego Estate Planning Attorneys.
