Financial Power of Attorney Living Trusts in Maine
Sometimes, a person may be able to accomplish daily tasks and live independently but be unable to manage their financial affairs. This situation may be particularly concerning when the person in question has significant wealth. If a member of your family is making increasingly erratic or ill-advised decisions with their money or property, it may be time to consider a conservatorship, a living trust, or durable power of attorney.
Making financial decisions
What is a financial power of attorney in Maine?
This is a legally binding document that names an attorney-in-fact to manage your financial affairs and property. The attorney in fact can be a person, but also a company such as law firm or bank. Traditionally, powers of attorney lost their validity when the principal–the person who signed it–became incapacitated. But the law created durable powers of attorneys, that remain in effect one the principal becomes incapable of managing their own affairs.
There are many kinds of powers of attorney, which can be limited only to making health care decisions, financials decisions, or even a single act like signing a contract or selling a piece of property. It’s also possible to sign a general power of attorney, which would give the attorney-in-fact the power to do anything in your place. But they all have one thing in common: the power of attorney can only last as long as you are alive.
Why do I need a financial power of attorney in Maine?
Without a durable power of attorney, if you become incapacitated, no one will be able to act on your behalf to manage your affairs or make healthcare decisions for you. As you will see below, a trustee may be able to take care of the assets you have placed in trust, but most people do not have trusts. The only alternative to a power of attorney is if your friends, colleagues, or family ask a probate court to appoint a guardian or a conservator for you. This is not always a straightforward process, because some people may testify that you are not incapacitated, or that you do not need to be taken care of. You can avoid unnecessary costs, hassel, and potential drama by naming an attorney-in-fact to act on your behalf by signing a durable power of attorney agreement.
What is a living trust in Maine?
Also called a revocable trust, this is a legally binding agreement in which you, the trustor, hand over all of your assets to a trust that is managed for your benefit. You may name a trustee to manage the trust, or you can remain in complete control by naming yourself trustee. If you become incapacitated, a successor trustee will take over the management of the trust. The trustee or successor trustee may be a friend, family member, or even a professional business such as a law firm or bank. When assets are placed into trust, they avoid probate upon your death, which allows for a faster distribution of your assets upon your death when compared to using a will.
When is a conservatorship in Maine a good idea?
A conservatorship is similar to a guardianship, in that it is a court order for situations where a person becomes incapacitated to the point where they can no longer make decisions for themselves. The conservatorship focuses on a protected person’s finances and property, which the court places under the control of a conservator, which may be a person, a corporation, or a state agency.
Generally, it’s best to avoid a conservatorship by executing a living trust or a power of attorney. But in some cases, a conservatorship may be unavoidable. If the protected person acts in conflict with their attorney-in-fact, it may be necessary to open conservatorship proceedings in probate court. As with a guardianship, you would need to present evidence that the protected person is incapactitated and in need of conservatorship.
With the assistance of our Maine estate planning attorneys, you will be prepared financially should the unthinkable happen
At Jackson MacNichol, we understand that estate planning can be a complicated and emotional process that quite literally will define your family’s future. That’s why we strive to focus on our individual clients’ needs, and are prepared to assist with every aspect of planning or settling an estate. We are always just one phone call away. For a free consultation about the estate planning process, call us today at 207-360-8889.