A Durable Power of Attorney is an estate planning document where an individual (known as the principal) appoints an agent to oversee their finances if they become incapacitated. The agent’s main responsibility is to act in the best interest of the principal at all times. They should be prudent and use caution when dealing with their loved one’s assets.
While the agent does have the power to invest, spend and sell their loved one’s property, they can be held liable for any damages stemming from a breach in their duties. This means the agent should keep very accurate financial records and not take any financial action unless authorized to do so by the power of attorney. Also, an agent cannot use the money for their own benefit or make any gifts unless it is expressly stated in the document that they have the right to do so.
An agent’s power ends with the death of the principal. The agent does not have any authority under a Durable Power of Attorney to handle the estate of their loved one unless granted in a last will and testament or by the probate court.
Because the agent’s specific authority stems from the wording of the Durable Power of Attorney, it is important to meet with a qualified elder law attorney to ensure that the proper language is used to best to reflect your needs and wishes.