A financial power of attorney, commonly just called power of attorney, is a legal document that appoints another individual to manage assets and other financial affairs on your behalf. The power granted by the document takes effect immediately upon the date it is signed and allows your attorney-in-fact to access, manage, liquidate or transfer your assets on your behalf in the event that you are unavailable or unable to do so. The power granted to your attorney-in-fact is terminated immediately upon your death.
A power of attorney is a crucial document in any estate plan. You can determine how much power is granted to your agent in your power of attorney by executing either a general or a limited power of attorney. A general power of attorney authorizes your agent to manage your financial affairs in as broad a manner as possible. A limited power of attorney specifies the actions or decisions your agent is authorized to make on your behalf or identifies any specific limitations you wish to make on the power granted. You may also limit the length of time your attorney-in-fact is authorized to act.