What is a Durable Power of Attorney?

What is a Durable Power of Attorney?

Under a durable Power of Attorney, you, as principal, appoint an Agent, also referred to as an Attorney-In-Fact, to act on your behalf, both while you are competent and should you lose your mental capacity. Your Agent can pay bills, sign contracts, manage finances and do many of life’s tasks that you handle for yourself.

Do I really need to sign a Power of Attorney now?

Understandably, it can make some people uncomfortable to give someone else this power. And most of us do not need an Agent to manage bills or sign contracts on a daily basis. But, as we know, life can throw some unexpected curve balls. One’s need for assistance can change in an instant. When there is no Power of Attorney, family members may be unable to put much needed care in place and manage the finances of a loved one.

What happens if I don’t have a Power of Attorney and I lose my mental capacity?

When it is determined that a person lacks mental capacity and has no Power of Attorney in place, the only option is for a family member to bring in legal guardianship so that someone has decision-making authority. A legal guardianship is a court proceeding, where a plaintiff asks the court to declare that the person lacks mental capacity and is in need of a guardian.

Even an uncontested guardianship is disruptive and expensive. It can also take many months to be completed, delaying the ability for the family to act. Once a guardianship is established, the Court is involved on an ongoing basis. For these reasons, it’s important to assign Power of Attorney well before such conditions arise. It will avoid time lost plus costly expenses and you have the choice of who has Power of Attorney.

Ok! I’ll get a Power of Attorney but who should I name as
my Agent?

A spouse or adult children are often the go-to choices for an Agent. Some other options of choosing the right Agent can be the following;

  • close friends
  • extended family
  • neighbors

You can name more than one Agent to serve at a time, which may help alleviate the concern about choosing one child over another, or as a safeguard against one Agent taking on too much control. If you can’t find someone to serve, there are also people who will serve as professional Agents when there are no other people who are good choices.

Can I just sign a springing Power of Attorney?

Different than a durable Power of Attorney, a springing Power of Attorney goes into effect only when the principal is declared incapacitated. In theory, this may sound like a good idea. However, I have found that it actually is a terrible idea!

For one, sometimes you need help “on the outside” even if you are mentally competent (such as during Covid), or if you just want a trusted person to help you with managing finances. In addition, banks and other financial institutions will keep asking for updates as to the mental capacity of the principal. It is an added layer of time and stress that you and your Agent will have to deal with, just when you need things to run smoothly.

If you are concerned about giving power when you are still managing your own affairs, I tell clients that we will hold the original Power of Attorney in the office vault, and will only release it with either the client’s consent or in some other manner that I work out with the client.

A Power of Attorney is a powerful document, and you need to be sure the Agents you choose are trusted people who will fulfill their obligations with your needs in mind. But most importantly, it should not be a document that you delay getting in place, no matter what age you are.

I already have a Power of Attorney. How often do I need a new one?

Some financial institutions will not honor a Power of Attorney that was signed a long time ago. Therefore, I recommend that clients sign new POAs every 10 years.


We are here to help. If you have questions about setting up assigning power of attorney and want to know more about how you can best plan for your future, please contact Allison J. Busch, Partner, Elder Law & Special Needs Planning at abusch@hdrbb.com or 973.467.1325.