Incapacity planning is an important part of estate planning. There may come a time when you cannot reasonably handle your own financial, legal, and/or medical affairs. For this reason, a power of attorney (POA) is a crucial estate planning document. You can use your POA to appoint a trusted person to manage affairs on your behalf. Choosing the right person for your POA is an absolute must. Here, our Indianapolis estate planning lawyer provides a guide to choosing the right power of attorney in Indiana.
Know the Law: Power of Attorney in Indiana
A power of attorney (POA) is a legal document that authorizes one person (the agent or attorney in fact) to act on behalf of another person (the principal). They can be created under state law. In Indiana, powers of attorney are governed by the Indiana Power of Attorney Act. State law (IC § 30-5-2-7) defines a POA as a written instrument that grants authority to an agent to act in the place of the principal. A POA may be general, granting broad authority, or limited, covering only specific transactions. A durable POA is a key estate planning tool because it remains effective even if the principal becomes incapacitated. Because a POA grants significant authority, Indiana courts require strict compliance with statutory formalities. In Indiana, a power of attorney must generally be signed by the principal and either acknowledged before a notary public or signed in the presence of two disinterested witnesses to be valid.
Pick the Best Person: Factors to Consider When Selecting an Agent
A POA is a key part of a comprehensive estate plan. With that being said, you should not just let any person serve as your agent. It is imperative that you grant your POA to the right person. Here are some considerations that you can use for selecting the right agent in Indiana:
- Trustworthiness: Trust matters. An agent will often have access to bank accounts, property, and sensitive personal information. The role requires absolute trust. You must select someone with a proven history of honesty, responsibility, and loyalty to your interests. Never pick a person to serve as your POA unless you can actually trust them.
- Financial and Legal Competence: Next, an agent must understand financial transactions, contracts, and recordkeeping. Someone with strong organizational skills and basic legal or financial knowledge is better equipped to manage investments, pay bills, and protect assets. A person who is trustworthy but not financially savvy may be a poor choice. How financially savvy they need to be depends on the complexity of your affairs. A person with especially complex financial and legal affairs may want to pick a professional.
- Availability/Proximity: An agent should be accessible and willing to act quickly when needed. If the agent lives far from Indiana or has demanding personal obligations, they may not be able to respond effectively. Choosing someone local often makes administration smoother. You are not required by law to pick an Indiana resident. However, selecting a non-resident could become a practical issue if they live far away.
- Ability to Handle Stress and Conflict: Family disputes can arise when one person is granted authority over another’s affairs. The agent must be capable of handling pressure and making firm decisions, even in the face of opposition. Emotional stability is a critical trait. You do not want someone who will be overwhelmed if a difficult issue arises.
- A Willingness to Serve: Imagine you found the most qualified person to grant your power of attorney. However, they do not want to do it. They are simply not a good choice. You need someone who wants to take the responsibility. Not everyone wants the responsibility of serving as attorney-in-fact. Before naming an agent, confirm that the person is willing to take on the role. Written acceptance can help prevent misunderstandings.
- Understanding of Your Values and Wishes: Finally, the best agent is someone who knows your priorities, preferences, and long-term goals. Whether related to healthcare decisions or financial risk tolerance, the agent should act in a way that reflects your personal values.
You Need to Make Sure that Your Power of Attorney Reflects Your Goals
Drafting a power of attorney is not a one-size-fits-all process. Your POA should reflect your unique goals, financial circumstances, and health considerations. For some, the primary purpose is to authorize an agent to manage property or business operations during temporary absences. For others, the focus is long-term planning to ensure continuity in the event of incapacity. Indiana law allows for both general and limited grants of authority. The scope must be clearly defined.
It is equally important to clarify whether the power is durable. A durable power of attorney remains valid if you later become incapacitated. It is an essential tool in estate planning. Without a valid POA, your family may be forced to seek guardianship through the courts, a costly and time-consuming process. An Indianapolis estate planning lawyer can help you with your POA documents, including drafting language that aligns with your true intent and satisfies all statutory requirements.
We are Leaders in Estate Planning in Indiana
Estate planning is complicated. Power of attorney is one of many estate planning provisions that you can use to protect your rights and your interests. Picking the right agent as your POA is a must. It can help to ensure that you are properly cared for (no matter what tomorrow might bring. At White & Jocham, we are a solutions-focused estate planning firm. Your initial consultation with our Indiana power of attorney lawyer is fully confidential and carries no additional obligations.
Call Our Indianapolis, IN Estate Planning Attorney Today
At White & Jocham, our Indiana estate planning lawyers handle the full range of POA issues, from signing to acting. If you have any questions about setting up a power of attorney, please give us a call now or contact us online. Initial consultations are completely confidential and carry zero additional obligations. We provide estate planning services in Greenfield, Indianapolis, and throughout Indiana.
