A Power of Attorney is an essential document.
One common misconception about powers of attorney –
A Power of Attorney continues after the death of the grantor. This is not the case. The authority given by a power of attorney is only effective during life. A power of attorney is a legal instrument in which a person grants decision making authority to another person. This decision maker is referred to as the “attorney-in-fact”, or sometimes the “agent”. The document that creates this authority is called a power of attorney.
Many people believe that the Agent has authority to handle the affairs of the person after death.
That is not the case. Once a person who has granted a Power of Attorney dies, the Agent’s legal authority dies too.
The only person who may handle the affairs of the decedent is called a “Personal Representative” or an “Executor.” Only a Last Will and Testament can appoint a Personal Representative and a procedure called “probate” lays out the steps that must be followed. Failure to follow these steps will result in frustration. For example, banks will not longer honor a Power of Attorney after the account holder has died and the Agent will not have any access to the account to pay bills incurred at death.
Important Tip: As part of your estate plan, make sure you have a plan to give your Personal Representative immediate access to funds to pay bills that are due. Consider a pre-paid burial plan so that your loved ones do not have to pay that bill for you and then wait months for reimbursement.