by Bill Griffith Bill Griffith No Comments

Updating Your Power of Attorney

Updating your Power of Attorney is something that you should consider doing if there have been changes in your life or to Pennsylvania law.

If you set up your estate plan through our firm, your Living Trust Package includes one set of state-specific ancillary documents per person.

The following ancillary documents are included in your trust binder:

  • Durable Power of Attorney for Assets
  • Durable Power of Attorney for Healthcare or Advance Directive
  • Living Will
  • Nomination of Conservator or Guardian

We recommend that people review their estate plan, which includes their ancillary documents, every five years to determine whether one or more of their powers of attorney should be updated based on changes in the law, their life, or other circumstances.

Life can be very unpredictable; you never know when something might happen. A sudden health emergency can happen anytime without warning and require immediate action.

Serious emergencies can upend a person’s entire life in a matter of days. We all know of someone who was living at home one day and then, due to a sudden emergency that caused a subsequent disability or incapacitation, went directly from the hospital to the assisted living/nursing home facility.

In the event of an emergency, a trusted family member or friend who is your appointed Attorney will then be able to act on your behalf. But, if you established your trust years ago, the person you named as the Successor Trustee of your Revocable Living Trust (RLT) and/or the appointed Attorney of your POA’s may no longer be available.

If you recently updated your Durable Power of Attorney for Healthcare or Advance Directive, the appointed Attorney will be able to make important and sometimes life-saving decisions on your behalf.

By reviewing your estate plan, you will be prepared for such an occurrence by deciding when the power granted to the appointed Attorney of your POA for Healthcare goes into effect.

For example, if you initialed the box that says, “This power shall not be affected by my subsequent disability or incapacity,” your appointed Attorney will be able to make decisions regarding your healthcare and personal finances immediately.

Due to the cost of long-term care (LTC), the Successor Trustee may also need to make decisions about your assets currently titled in the name of your Revocable Living Trust.

But what about assets NOT titled in the name of the trust? The Durable Power of Attorney for Assets “may” apply to assets NOT titled in the name of the trust. It is important to know what documents will be needed when the time comes. Having updated POA’s will make the process so much easier. For instance, when it comes to signing a real estate listing agreement, agreement of sale, and a deed, will the Successor Trustee be required to provide the Abstract of Trust along with proof showing that he or she is now the Successor Trustee? Or will the appointed Attorney be required to provide the Durable Power of Attorney for Assets?

Matters can be complicated when it is unclear whether a person may or may not still be able to serve as the Trustee of the trust. For example, what if a person becomes disabled, but is still competent?

The trust might state that, “Upon the death, resignation, disappearance, or incompetency of the Original Trustee, or if for any reason the Original Trustee is unable to serve, or to continue to serve as Trustee hereunder, the Trustor nominates and appoints someone to take over and serve as Successor Trustee of the Trust without the approval of any court.”

These are all important questions that should get answered sooner rather than later. By being proactive and getting your questions answered ahead of time, you will know whether the Successor Trustee can act automatically by virtue of the language in the Trust, or if anything will be needed prior to taking over as the Successor Trustee, such as a letter from a doctor.

Now that you know why reviewing and updating your Power of Attorney is so important, consider taking the time to update your own plans, especially if it has been over five years since setting up your estate plan.