Your New Jersey estate plan does not have to be complex to prove effective, but there are certain elements most estate plans should include. A durable power of attorney, also called a financial power of attorney, is one such element, and there are certain things to keep in mind when creating yours.
Per Kiplinger, a financial power of attorney gives you a chance to designate an “agent” to act on your behalf when certain circumstances come to fruition. The document gives the party you name permission to handle your finances, which might include paying bills and making other financial moves in your place if you become unable to do so. When drafting your durable power of attorney, keep the following in mind.
1. You need a backup agent
Many people who create durable powers of attorney fail to address what happens if something happens to the named agent. It is wise to have someone else named as a backup in the event that your first choice dies, suffers incapacitation or refuses to act in this capacity.
2. You may want to address gift giving
You may also choose to give your power of attorney the ability to give away some of your assets as gifts. You may limit how much power your agent has in this area if you want him or her to have any.
3. You need to consider real estate
You may also want to consider whether to give your agent the ability to manage your real estate holdings. If you wish to do so, you may need to take extra steps with your local land records office.
By putting some forethought into your durable power of attorney, you increase the chances of it effectively serving your needs.