Have you recently been appointed as an agent under a power of attorney? You’re now able to act in place of the person executing the power of attorney, known as the principal.
Needless to say, this is a very big responsibility. It’s important to know what your duties are as an agent, as well as how and when you’ll be required to perform them. This introduction to acting as the agent under a power of attorney will give you a better understanding of how to carry out your duties.
The main responsibility of an agent is to carry out the wishes of the principal with respect to financial affairs. This means you will manage their finances as the principal would want them to be managed. This covers things like:
Making deposits/withdrawals from bank accounts
Your role here is as a fiduciary, which means that you’re expected to act in the best interests of the principal at all times. If you act in a way that is inconsistent with the wishes of the principal, you may be held liable for these actions.
When will my role as an agent take effect?
In most cases, your role takes effect as soon as the principal signs the document. However, if this is a “springing” power of attorney, it takes effect when an event that is stipulated to in the document takes place, for example, in the event that they become incapacitated. The document usually stipulates that a physician must certify the principal as incapacitated in order for the power of attorney to take effect.
Can I be removed from my role?
Yes. The principal can revoke your status as an agent whenever they wish, provided he or she still has the mental capacity to do so. .
As the power of attorney, you should keep records of all of your actions. Not only will this help you answer any questions that may be brought up, it will also help prevent mistakes by keeping these actions independent of your own.
Usually, the power of attorney is a family member and performs this role with no compensation. However, you can stipulate with regard to compensation in the document before it is signed.
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