Durable Power of Attorney for Asset Management in San Mateo
Imagine a homeowner in San Mateo who suffers an unexpected stroke. They become incapacitated, and unable to manually make their mortgage payment, monitor their investments, or pay their property taxes. Their partner assumes that they can simply step in and manage these accounts for them, but they quickly find out that without a durable power of attorney in place, they are unable to step in and take action immediately.
It’s a common mistake for couples to assume that if something happens to one of them, their partner or children can take over the management of their assets.
But legally, that is seldom the case.
Without a durable power of attorney for asset management, San Mateo spouses may not have the legal authority to access individually owned accounts, manage investment assets, sign documents, or even deal with financial institutions on their spouse’s behalf.
At the Law Office of Vidhya Babu, we help families in San Mateo and the Bay Area prepare for the unexpected with durable power of attorney services that protect finances, and give legal authority to trusted family or friends to manage assets if you’re ever unable to do so yourself.
Contact the Law Office of Vidhya Babu today to schedule an initial consultation and learn more about the benefits of a durable power of attorney.
What is a Durable Power of Attorney for Asset Management?
A power of attorney (POA) is a type of legal document used when one person, the principal, wants to authorize another person, the agent, to manage their financial, business, or legal affairs on their behalf.
A standard, non-durable power of attorney is often created for a specific purpose or temporary period of time, and generally terminates when someone becomes incapacitated. POAs are often used for short-term situations, like handling a real estate closing, or to have someone manage your affairs while you’re overseas.
However in estate planning, a durable power of attorney extends the power through incapacity or cognitive decline. This allows the agent to continue managing the financial matters authorized in the document, even if the principal becomes incapacitated later.
For estate planning purposes, this document is vital. Without a durable power of attorney for asset management, a person’s loved ones may have to petition the court for a conservatorship simply to do basic things like pay bills, access accounts, or manage finances.
Creating a durable power of attorney before it’s needed can help loved ones avoid unnecessary legal hurdles during an already emotional and stressful time. It streamlines the process, and helps avoid the expensive and time consuming public process of seeking a conservatorship.
Who Can Benefit From a Durable Power of Attorney?
Estate planning is often seen as something to do only later in life, but the reality is that an accident or illness can leave individuals of any age incapacitated and unable to manage their own affairs.
Creating a durable power of attorney is especially important for those who have significant financial responsibilities that would need to carry on if they become incapacitated.
Homeowners
For many families in San Mateo, their high-value home is their most significant asset. If you are incapacitated, your mortgage will still need to be paid, repairs may still need to be made, and annual property taxes will still be due. Because it's impossible to know how long incapacity can last, a durable power of attorney gives you the peace of mind that someone you trust will continue to manage these responsibilities without delays or court involvement.
Retirees
Those who have reached retirement age often hold multiple financial accounts including pensions, retirement savings, investment accounts, and Social Security benefits. As they age, they may experience illness or cognitive issues that can make managing these assets difficult. A durable power of attorney makes sure that a trusted family member or friend can step in and manage their finances, according to their wishes.
Families
Many families assume that their spouse or older children will be able to step in and manage their finances if something happens to them, but that is not always the case without proper planning. Whether you have young children or are helping care for aging parents, a durable power of attorney can provide the peace of mind families need during an unexpected situation, without court intervention.
Business Owners
Many small businesses and startups rely on the founder or owner’s daily involvement. They often have significant responsibilities that cannot be put on hold, involving financial transactions, contracts, and banking matters. Naming a durable power of attorney allows a trusted individual to step in and maintain business continuity, ensuring that can still be handled even when you are unable to do so yourself.
Working Professionals
In the Bay Area, working professionals often have insurance policies, RSUs, investment accounts, mortgages and other financial obligations that will continue regardless of health. A durable power of attorney helps ensure that bills will continue to be made and financial obligations met in the event of unexpected illness or incapacitation.
What Powers Does an Agent Actually Have?
Another misconception is that signing a durable power of attorney automatically gives the agent unfettered control over your finances. However, the actual powers of the attorney can, and should, be customized to each individual.
In a typical durable power of attorney for asset management, an agent can have a range of responsibilities.
- Paying monthly bills
- Accessing bank accounts
- Managing investment accounts
- Buying or selling real estate when specifically authorized
- Depositing checks
- Filing or paying taxes
- Managing retirement accounts
- Collecting government benefits
- Handling insurance matters
- Signing financial documents
What powers are actually included should be determined by the principal at the time their documents are drafted.
Choosing the Right Durable Power of Attorney
There are two types of durable power of attorney: springing and immediate.
A springing durable power of attorney only becomes effective after a specific triggering event, usually incapacity. Some individuals prefer this because authority is only granted when it’s needed. However, it can also delay action when families need immediate access to funds, and financial institutions need proof of incapacity before allowing an agent to act.
An immediate durable power of attorney becomes effective immediately after it is. Although the authority is effective immediately, many people choose to keep the original document in a secure location or give it to the agent only when it becomes necessary to act. Because there is no need to prove incapacity, many families find immediate durable powers of attorney easier for loved ones and financial institutions to rely on in an emergency.
An experienced estate planning attorney can help you understand the advantages of each option and help you choose the approach that fits your family’s needs.
Why Work With a Power of Attorney Law Firm?
While the state of California does provide statutory forms for creating a durable power of attorney as a standalone document, every person’s financial situation is different.
One limitation of a templated DPOA is that it isn’t tailored to your family’s unique financial situation and individual needs.
By working with an estate planning attorney, you’ll get a fully customized document that fits your specific needs, grants the right amount of power, and is ready to be used when your family needs it most. A templated document can’t give you the same level of control that an attorney can.
At the Law Office of Vidhya Babu, we believe that a durable power of attorney is most effective when it is created as part of a comprehensive estate plan. We help our clients in San Mateo and the Bay Area coordinate all their existing estate planning documents, such as wills, trusts, durable powers of attorney, and advance healthcare directives. We can also help you create these documents from scratch, so that you have a single coordinated estate plan.
When you work with us, you get:
- Customized durable power of attorney documents tailored to your assets, financial responsibilities, and long-term goals.
- Compliance with California law, ensuring that your documents avoid mistakes common in online forms, and are ready to use the moment they are needed.
- Legal guidance from an experienced estate planning attorney that understands the needs of San Mateo and Bay Area families.
- Coordination with your Living Trust, Will, and Advanced Health Care Directives, or help creating a comprehensive estate plan for your family.
- Periodic reviews that keep your documents current and reduce potential conflicts with financial institutions.
Durable Power of Attorney Services and Estate Planning for San Mateo Families
Don’t make the mistake of assuming that your partner will be able to manage your financial affairs if you become incapacitated. Durable power of attorney services help your family prepare for the unexpected.
Whether you’re looking to round out your estate plan or need help creating a comprehensive set of estate planning documents, the Law Office of Vidhya Babu is ready to help.
Based in San Mateo and serving the Bay Area, we can provide you with the legal guidance to create an effective durable power of attorney for asset management.
Contact our team today for a free initial consultation.
FAQs About Durable Power of Attorney Services in California
A durable power of attorney is a legal document that allows a person to designate another person to manage their financial and property matters in the event that they become incapacitated or unable to make decisions on their own.
A standard power of attorney has a limiting factor, whether it is time or incapacity. A durable power of attorney is called so because it holds power after the principal becomes incapacitated. It’s designed to provide a trusted family member or friend with the power to step in and manage your financial affairs when you’re no longer able to.
A durable power of attorney can be created as a springing power or an immediate power of attorney. Springing powers of attorney only take effect when a triggering event has occurred, such as incapacitation or cognitive decline. An immediate power of attorney takes effect once the documents have been signed.
Yes, it is entirely possible to customize what powers your agent has as your power of attorney. However, statutory documents do not include this customization. To customize your documents, consider working with power of attorney services.
Technically, no. The state of California provides statutory documents online for creating a durable power of attorney. However, these documents may not fully address every person’s financial situation or estate planning goals. Working with a power of attorney law firm ensures your documents are customized to your family’s needs and goals.
Yes, as long as the principal is still mentally competent, it can be revoked. The authority of the agent will otherwise end at death or when the principal regains function.
Your agent should be someone that you trust explicitly with your financial affairs. This is most often a partner, but it can be an adult child, a close friend, or anyone of your choosing.
The contents and materials of this website should be used as a general guideline and not as the ultimate source of current information. The user should consult their own legal, accounting, or other advisors.