What is a Power of Attorney for Finances?

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A Power of Attorney for Finances is a document that authorizes another person (called the “agent” or “attorney-in-fact”) to handle the financial affairs of the person executing the document (called the “principal”), consistent with the terms of the document and the agent's fiduciary duty to the principal.

A Power of Attorney for Finances is also often called a Durable Power of Attorney or a General Power of Attorney.

To be considered “durable,” the document must expressly state that the document is in effect during a period of incapacity.  A document that is "durable" authorizes the agent to act on behalf of the principal when the principal is mentally incapacitated.

A Power of Attorney for Finances is essentially a private arrangement between the principal and the agent;  there is virtually no regulation of Powers of Attorney for Finances.  It is important to include in a Power of Attorney for Finances document, especially one that is durable, protections against abuse by the agent, such a requiring a regular accounting, and limiting - or prohibiting - the making of gifts.

If a Durable Power of Attorney is not executed, or other suitable arrangements made (for instance, a trust or the appointment of a representative payee), a Guardian of the Estate must be appointed if the principal loses the mental ability to make financial decisions.

CWAG publishes a Do-it-Yourself Consumer Packet: Wisconsin Basic Power of Attorney for Finances and Property Form.   The packet includes educational information, as well as the state Power of Attorney for Finances and Property form.  It is available for a voluntary $2.00 contribution by calling 1-800-488-2596 ext. 301.