A durable power of attorney is one of the most important estate planning documents an adult can have—and one of the most commonly missing from people’s legal portfolios. Without it, if you become incapacitated due to an accident, illness, or cognitive decline, no one—not your spouse, not your adult children—can automatically manage your financial affairs on your behalf. The estate planning attorneys at SBEMP Attorneys LLP help Coachella Valley residents understand this critical document and ensure it is properly drafted and in place before it is needed.
What Is a Power of Attorney?
A power of attorney (POA) is a legal document in which one person (the principal) authorizes another person (the agent or attorney-in-fact) to act on their behalf in legal or financial matters. The agent acts in the principal’s place and can take actions that have the same legal effect as if the principal had taken them directly.
What Makes a Power of Attorney ‘Durable’?
The critical distinction between a standard power of attorney and a durable power of attorney is what happens if the principal becomes incapacitated. A standard (non-durable) power of attorney automatically terminates when the principal becomes mentally incapacitated. A durable power of attorney specifically states that the agent’s authority survives the principal’s incapacity—and remains in effect precisely when it is most needed.
Without the durable designation, a power of attorney provides no protection during incapacity—the very scenario it is most commonly needed for. All power of attorney documents intended for estate planning purposes should be durable.
What Can an Agent Do Under a Durable Power of Attorney?
The scope of the agent’s authority is defined by the document itself and can be broad or limited. A comprehensive durable power of attorney typically authorizes the agent to:
- Manage and access bank and investment accounts
- Pay bills and manage ongoing financial obligations
- File tax returns
- Manage real property—including collecting rent, making repairs, or selling property if authorized
- Make investment decisions
- Manage business interests
- Apply for government benefits
What a Durable Power of Attorney Does NOT Cover
A durable power of attorney for finances covers financial and legal matters. It does not cover healthcare decisions—those require a separate document called a healthcare directive (advance directive or healthcare proxy). A complete estate plan includes both. SBEMP drafts both documents for clients as part of a comprehensive estate planning engagement.
What Happens Without a Durable Power of Attorney?
If an adult becomes incapacitated without a durable power of attorney in place, family members who need to manage that person’s finances must seek a court-appointed conservatorship—a public, expensive, and time-consuming judicial process. In California, conservatorship proceedings can cost thousands of dollars in attorney fees and court costs and take many months to complete. During this time, bills may go unpaid, investments may be unmanaged, and the incapacitated person’s financial affairs may suffer significant harm.
When Should You Create a Durable Power of Attorney?
Now—regardless of age or health status. Incapacity can happen suddenly and unexpectedly at any age. A durable power of attorney can only be signed by a person who currently has mental capacity. Waiting until a crisis occurs is too late—the document cannot be created after capacity is lost.
SBEMP provides estate planning services to residents throughout Palm Springs, Rancho Mirage, Indian Wells, Palm Desert, La Quinta, and the broader Coachella Valley. To create or update your durable power of attorney, contact our estate planning attorneys today.