Part of the estate planning process is deciding who one wants to be responsible for making financial decisions on one’s behalf should one become incapacitated. The person designated as a financial power of attorney will have a lot of responsibility. It is not a role that should be given to just anyone. Here are a few things New Jersey residents may want to consider when choosing a financial POA.
The first thing one may want to think about is whether the POA should be assigned to a family member, friend or professional. The individual designated to this role needs to be able to handle the stress that comes with it. Will they be able to manage property, tackle investment accounts, pay bills on time and deal with creditors — among other things? Most people choose a family member or friend as their financial POA, but those who do not have anyone close whom they believe fit to manage their assets may want to turn to a trusted professional — such as an accountant, attorney or specialty firm — to do the job.
After narrowing down the list to those whom one thinks can handle the job, the second thing to consider is who will act in one’s best interests. Every decision the agent makes has to be with one’s best interests in mind. The sad reality is, not all POA agents end up doing this. So, don’t be too quick about deciding to whom this role should go. Take time to determine whom to trust with this responsibility.
Finally, after picking an agent, the third thing one might want to think about is how much power he or she will actually have. A POA does not give the designated agent the green light to do whatever he or she wants with all of one’s assets. It is possible to leave clear guidelines as to what he or she does and does not have control over.
Choosing a financial POA can be difficult. Challenging as it might be, it is still something New Jersey residents may want to consider doing so that, if they become incapacitated, their assets will be managed by someone they know and trust rather than someone appointed by the court. When the decision is made, legal counsel can help one create the documents needed to make it official.