Should You Include In Your Power Of Attorney The Power To Amend Your Trust?
I have been thinking lately about when to include in a durable power of attorney the power to amend a trust. The power of attorney works when you are unable to make your own decisions, perhaps because of an accident or perhaps because of age-related illness. You can sign a power of attorney now but may not need it, if ever, until many years into the future.
Let’s say you sign a trust and a power of attorney this year with your spouse. Years from now, you are incapacitated. Your spouse starts handling your affairs by using the power of attorney. But should your spouse be able to amend the trust that you signed years before? That trust should state who gets your property when you die. The right to change that document is an important one.
Most of the time, the issue does not come up. If you become disabled in the future, the trust you set up with your spouse still works for you, and there is no need to amend it. But what if circumstances had changed? Perhaps you would not have wanted some nephew to inherit part of your estate. If the power of attorney gives your spouse the power to amend the trust, he can simply do so. But if it doesn’t, he would probably need to go to court to get it amended. That can be complicated, costly and have an uncertain outcome.
On the other hand, you don’t want to give someone the power to amend your trust without thinking about it. That power can be abused. If you need someone to act as your agent under the power of attorney, you are probably incapacitated and vulnerable.
As ever, you need to discuss this with your advisors and reach an informed decision.