Business Succession, Disability Insurance, Estate Planning, Life Insurance, Medical Power of Attorney, Power of Attorney, Uncategorized, Wealth

Your Power of Attorney Matters Little if…

A frequent retort I hear from potential and new clients is that they don’t need a will because they have a financial and medical power of attorney already.

After they pass away, their agent can transfer the bank accounts, sell the stocks and family home, etc… right?

In that situation, I have to refrain from getting too excited.

It’s an understandable position to have: most powers of attorney give authority to another in a wide and comprehensive manner. Why wouldn’t that apply after someone has passed?

I tell people to think of estate planning in two separate sets of documents: pre-death legal documents and post-death legal documents.

In this case, any power of attorney is a part of the “pre-death” legal documents while any kind of will is going to be a “post-death” legal document.

And the two types of document do not affect one another.

In other words, in Texas, a power of attorney is no longer effective after the principal (the signer) has passed away.

This means that you are back to square one after you have passed away. No one is in charge of anything, even if you have the best and most comprehensive powers of attorney in the world.

And that’s why your estate plan needs both powers of attorney (pre-death legal documents) and a will (post-death legal documents).

Financial and medical powers of attorney protect your finances and health while you’re still alive, and a will protects your estate after you have passed.

Don’t make the same mistake as others and ensure that your estate plan covers what happens to you while you’re still alive and what happens to you after you’ve passed.