One of the most essential components of any estate plan involves giving someone power of attorney. This right gives an individual the right to make legal and medical decisions on your behalf if you ever become incapable of making them independently.
Despite its prevalence among New Yorkers, numerous myths persist around powers of attorney. You need to separate fact from fiction, so you can make informed decisions about your future.
Myth #1: The power of attorney can do whatever she or he wants with your estate
First, you should only give power of attorney to someone you trust completely. This is why most people commonly give their spouse this obligation. However, even under this circumstance, a power of attorney cannot do whatever he or she pleases with your money. An agent under power of attorney has a fiduciary obligation to make decisions in your best interests. Therefore, the power of attorney would not be able to transfer all your money to a different bank account for no reason.
Myth #2: You can assign someone power of attorney online
There are plenty of websites you can find that promise to give you power of attorney documents. While it all seems straightforward, you should never leave something so important to chance. It is possible the document you find online does not cover all the legal requirements set forth by New York, and it may be too ambiguous to go into effect.
Myth #3: Someone legally incompetent can sign off on a power of attorney
This is one of the most vital myths you need to debunk. Someone can only sign off on a power of attorney if he or she has the legal capacity to do so. Far too many families wait until the person lacks the wherewithal to sign legal documents. This is why it is important to establish power of attorney early in life.