Creating a comprehensive estate plan typically means creating and executing much more than just a Last Will and Testament. Exactly which additional documents will become part of your estate plan will depend on individual circumstances, goals, and concerns. Having said that, however, there are some estate planning documents that are commonly added to an overall estate plan. One of those is a durable power of attorney. Of course, you should consult with your estate planning attorney before deciding if a durable power of attorney should be included in your own estate plan but a basic understanding of what one is and why people typically choose to include one is certainly helpful.
At its most basic, a power of attorney is a legal document that allows you to grant another person the legal authority to act on your behalf. As the person executing the POA you are known as the “principal” while the person to you grant authority is referred to as the “agent”. While there are a variety of different types of POAs, one important type to understand is a “durable” POA. A traditional power of attorney would automatically terminate upon the incapacity of the principal. Because this is precisely when most people want their POA to be effective the law developed the concept of a “durable” power of attorney. The term “durable” when included in a POA simply means that the powers granted within the documents survive the incapacity of the principal.
Because a durable power of attorney survives the incapacity of the principal many people choose to execute one as part of their incapacity plan. By doing so, you have the ability to grant someone the authority to make decisions for you and/or control your assets in the event you are unable to do so at some point in the future. In Texas, a durable POA can grants the agent very broad powers; however, you also have the option to limit the authority you grant an agent in your durable power of attorney. You may decide, for instance, to grant your agent all powers except the power to act in real estate transactions.
A durable power of attorney in Houston Texas is certainly one option that can be included in an incapacity plan; however, it is not the only option. Strategies such as jointly titling property, creating “payable on death” accounts, and/or the creation of a revocable trust are other options that people frequently use when creating an incapacity plan. Be sure that you consult with your Texas estate planning attorney to decide what strategies work best for your overall plan.