What if you were in a coma, or otherwise incapacitated such that you were unable to communicate? Or struck with a disease or other tragedy which affected your mind? Who should control your finances, or your assets? A Power of Attorney1 ensures that your wishes in these and other unexpected circumstances are heard, understood, and carried out to your specifications.
A Power of Attorney is normally a relatively simple legal document. Its purpose is simply to appoint another person or persons to sign documents and make decisions on your behalf.
There are actually a few different types of Power of Attorney:
A "General Power of Attorney"2 is the authorization for another person to act on your behalf for legal, financial or business matters. You may do this, for example, if you have emigrated and have ongoing legal or business matters to attend to. In this case, it may be convenient to have an authorized person sign documents on your behalf.
An "Enduring Power of Attorney"2 has the same authorization, but the powers continue to be effective even if you become mentally incapacitated or incompetent for any reason. Of course, you must be competent before the Enduring Power of Attorney is set up. You can also set up an Enduring Power of Attorney to only come into effect if or when you become mentally incompetent.
When does a Power of Attorney take effect?
A power of attorney for property takes effect as soon as it is signed and witnessed, and can be revoked at any time provided you are mentally competent.
If you do not want your power of attorney for property to take effect immediately, you must specifically state in the power of attorney that it will take effect on a later date. For example, if you want the power of attorney to come into effect only if you become mentally incompetent, you must say so in the power of attorney document.
Can you revoke it?
Generally, a power of attorney lasts until your death. However, you can revoke a power of attorney at any time if you are mentally competent. By revoking a power of attorney, it means that it is canceled and no longer effective. Although there is no special form that must be completed to revoke a power of attorney, the cancellation must be written and signed in front of two witnesses who are both present when you sign. The two witnesses must then also sign.
Mutual Funds and Segregated Funds provided by the Fund Companies are offered through Worldsource Financial Management Inc., Other Products and Services are offered through Dave Gorman Financial Strategies.