Skip to content When it comes to planning for your future, few legal documents are as valuable as a financial power of attorney. At Desert Valley Law, we help Glendale residents and people across Arizona establish solid financial protection plans that give them peace of mind about their financial affairs, even during difficult circumstances.
A financial power of attorney (POA) is a legal document that allows you—the “principal”—to designate another person—your “agent” or “attorney-in-fact”—to make financial decisions and handle financial matters on your behalf. This powerful tool ensures that someone you trust can step in to manage your finances if you become unable to do so yourself due to illness, injury, or other circumstances.
Patrick Monahan, who has been practicing law since 2007 and is admitted to the Arizona State Bar, understands that creating a financial power of attorney is a deeply personal decision that requires careful consideration of your unique situation and goals.
Life is unpredictable. Though we don’t like to dwell on unfortunate possibilities, being prepared for them is simply good planning. Here are several reasons why Glendale residents should consider establishing a financial power of attorney:
None of us can predict when an accident or sudden illness might leave us temporarily or permanently unable to manage our own financial affairs. Without a financial POA in place, your loved ones would need to petition the court for guardianship or conservatorship—a process that can be:
As we age, managing complex financial matters can become increasingly challenging. A financial POA allows you to choose someone you trust to help with these responsibilities while you’re still able to provide guidance and oversight.
If you travel frequently or have business interests that may require attention while you’re unavailable, a limited financial POA can ensure that specific financial tasks are handled appropriately during your absence.
Simply knowing that you’ve planned ahead and appointed someone you trust to protect your financial interests can provide enormous peace of mind—not just for you, but for your loved ones as well.
Arizona law recognizes several types of financial powers of attorney, each serving different needs and purposes. At Desert Valley Law, we help clients in Glendale and throughout Arizona understand their options and choose the type that best suits their situation.
A durable power of attorney remains effective even if you become incapacitated. This is often the most beneficial type of financial POA because it ensures continuous management of your financial affairs if you’re unable to handle them yourself due to illness or injury.
In Arizona, powers of attorney are automatically considered durable unless the document specifically states otherwise. This provides important protection for the principal.
A non-durable power of attorney automatically terminates if you become incapacitated. This type is less common for estate planning purposes but might be appropriate for specific, short-term financial matters.
A springing power of attorney “springs” into effect only when a specified event occurs—typically, when you become incapacitated. This option allows you to maintain complete control over your finances until you’re unable to do so.
It’s important to note that springing powers of attorney require careful drafting to clearly define the conditions under which they become effective. Without clear language, determining when the POA goes into effect can become complicated and may require court intervention.
A limited or special power of attorney grants your agent authority to handle only specific financial tasks, such as:
This type of POA can be particularly useful when you need someone to handle defined transactions but don’t want to grant broad financial authority.
A general power of attorney gives your agent comprehensive authority to manage all your financial affairs. This broad authority can include:
Because of its extensive scope, a general power of attorney should only be granted to someone you trust implicitly.
When you create a financial power of attorney in Arizona, you decide exactly what powers to grant your agent. These powers can be as broad or as limited as you prefer. Some common powers include:
Your agent can access and manage your bank accounts, including:
Your agent can make decisions regarding your investments, such as:
Your agent can handle real estate matters, including:
Your agent can ensure your financial obligations are met by:
Your agent can interact with government agencies to:
Your agent can hire legal representation for financial matters and participate in legal proceedings on your behalf (except those requiring personal appearance).
In Arizona, an agent under a financial power of attorney has a fiduciary duty to act in your best interests at all times. This legal obligation means your agent must:
If your agent fails to uphold these responsibilities, they may be liable for any damages caused by their breach of duty. This provides important protection for you as the principal.
Choosing the right person to serve as your financial agent is one of the most important decisions you’ll make when creating a power of attorney. This decision requires careful thought about both practical capabilities and personal trustworthiness.
When selecting your financial agent, consider these important qualities:
Above all, your agent must be someone you trust completely. They will potentially have access to your finances and the authority to make significant financial decisions on your behalf.
Your agent should demonstrate good financial management in their own life. Someone who struggles with debt or makes poor financial decisions may not be the best choice to manage your finances.
Consider whether your potential agent has the time to handle your financial affairs and whether their geographic location might create practical challenges.
Managing someone else’s finances requires attention to detail and good organizational skills. Your agent will need to keep thorough records and possibly manage complex financial matters.
Ideally, your agent should understand your values, preferences, and long-term financial goals to make decisions that align with your wishes.
While advanced financial knowledge isn’t strictly necessary, basic financial literacy will help your agent manage your affairs effectively.
If your agent will need to interact with family members or business associates, the ability to communicate effectively and handle potential conflicts diplomatically is valuable.
Make sure your chosen agent is willing to take on this responsibility. Being someone’s financial agent can be demanding, and it’s important that they understand and accept the role.
Most people select one of the following as their financial agent:
Life circumstances change, and your primary agent may become unable or unwilling to serve when needed. For this reason, we always recommend naming at least one successor agent who can step in if your first choice cannot serve.
Before finalizing your financial power of attorney, have a detailed conversation with your chosen agent about:
This conversation ensures your agent is prepared to fulfill their responsibilities if and when the time comes.
Creating a legally valid financial power of attorney in Arizona involves several important steps. At Desert Valley Law, we guide clients in Glendale and throughout Arizona through this process to ensure their documents are properly prepared, executed, and recognized by financial institutions.
The process begins with a thorough discussion of your financial situation, goals, and concerns. This consultation helps determine:
Based on your specific situation and Arizona’s legal requirements, we draft a customized financial power of attorney document that clearly outlines:
In Arizona, a financial power of attorney must be:
Arizona law requires that you must be mentally competent when you sign your power of attorney. This means you must understand:
If your financial power of attorney grants authority to conduct real estate transactions, it should be recorded with the county recorder’s office in any county where you own property. In Glendale, this would be the Maricopa County Recorder’s Office.
Once executed, you should:
We recommend reviewing your financial power of attorney every few years or after major life events such as:
While a financial power of attorney is an essential planning tool, certain challenges can arise. Being aware of these potential issues can help you create a more effective document and prepare your agent for success.
Some banks and financial institutions may be hesitant to honor a power of attorney, particularly if it was executed many years ago. They may be concerned about fraud or liability if they accept an invalid document.
To minimize this challenge:
Unfortunately, disagreements among family members about financial management can create tension and even lead to legal challenges of an agent’s authority.
To reduce the risk of family conflict:
While rare, especially when agents are carefully chosen, there are cases where agents abuse their authority for personal gain.
To protect against potential misconduct:
If you choose a springing power of attorney, determining when you become incapacitated can sometimes be challenging.
To address this issue:
While a financial power of attorney is a crucial component of a comprehensive estate plan, it’s important to understand how it differs from and works alongside other essential documents.
These two documents serve distinct but complementary purposes:
While you can name the same person as agent for both documents, some people choose different individuals based on their respective strengths and capabilities.
These documents operate at different times and serve different functions:
Your financial POA has no authority to change your will or manage assets after your death.
While both can address financial management, they operate differently:
Many comprehensive estate plans include both a financial power of attorney and trusts, as they serve complementary purposes.
A properly executed financial power of attorney often eliminates the need for court-appointed guardianship or conservatorship:
One of the primary benefits of creating a financial power of attorney is avoiding the need for these court proceedings.
Circumstances change, and you may find that you need to update or revoke your financial power of attorney. As long as you are mentally competent, you retain the right to make these changes.
In Arizona, you can revoke your financial power of attorney by:
If the original document was recorded with the county recorder, the revocation should also be recorded.
You might want to revoke or update your financial power of attorney when:
It’s important to understand that certain events automatically terminate a financial power of attorney:
In 2017, Arizona adopted the Uniform Power of Attorney Act, which provides important protections and clarifications for principals, agents, and third parties who rely on these documents.
The Arizona Uniform Power of Attorney Act includes several provisions that strengthen and clarify financial powers of attorney:
Financial institutions must accept a properly executed power of attorney or provide a specific reason for refusal within a reasonable timeframe.
The Act clearly defines the fiduciary duties of agents and the standards of care they must follow.
Certain powers, sometimes called “hot powers,” must be explicitly granted in the document, including:
The Act provides protection for third parties who accept powers of attorney in good faith.
The Act improves recognition of powers of attorney executed in other states.
While online forms and do-it-yourself options exist, creating a financial power of attorney without professional guidance can lead to significant problems. At Desert Valley Law, we’ve seen the consequences of poorly drafted documents and understand the importance of personalized legal advice for this critical planning tool.
Self-created financial powers of attorney may:
When you work with Desert Valley Law for your financial power of attorney, you receive:
At Desert Valley Law, Patrick Monahan brings his experience since 2007 to help clients throughout Glendale and Arizona create effective financial powers of attorney. Our approach includes:
Taking the next step toward creating your financial power of attorney is simple. Desert Valley Law serves clients throughout Glendale and across Arizona with personalized service and attention to detail.
During your initial consultation, we’ll discuss:
Once we understand your needs, we’ll:
Our relationship doesn’t end when your documents are signed. Desert Valley Law provides:
Business & Estate Law Attorneys
Rely on Desert Valley Law for representation in Financial Power of Attorney matters, and discover the reasons behind our firm's reputation among clients throughout Arizona.
When it comes to establishing a Financial Power of Attorney in Arizona, Desert Valley Law provides the guidance and support you need. We understand that planning for financial decision-making in case of incapacity is a significant step that requires careful consideration and proper legal documentation. At Desert Valley Law, our attorneys bring years of professional experience in Arizona business and estate planning law to help you create a comprehensive Financial Power of Attorney that protects your interests and ensures your financial affairs are managed according to your wishes. Whether you’re a business owner seeking to designate authority during absences, an individual planning for potential health issues, or a family preparing for the future, our Glendale-based firm offers personalized service with attention to detail that Arizona clients have come to trust. We work diligently to understand your specific needs and craft legal solutions that provide both security and peace of mind.
Contact our Financial Power of Attorney Attorneys at 623-283-1500
A Financial Power of Attorney in Arizona is a legal document that authorizes someone (called an “agent” or “attorney-in-fact”) to make financial decisions and transactions on your behalf. This document allows your designated agent to manage your finances, pay bills, buy or sell property, access bank accounts, and handle other financial matters according to the powers you specifically grant them. In Arizona, these documents are governed by the Arizona Uniform Power of Attorney Act and can be set up to take effect immediately or only if you become incapacitated.
A Financial Power of Attorney specifically addresses financial and property matters, while other types of Powers of Attorney serve different purposes. For example, a Healthcare Power of Attorney designates someone to make medical decisions on your behalf if you’re unable to do so. A General Power of Attorney covers both financial and personal matters but typically terminates if you become incapacitated. A Durable Power of Attorney (which can be financial or healthcare) remains valid even if you become incapacitated. In Arizona, it’s common to have separate documents for financial and healthcare matters to ensure your wishes are clearly defined in each area.
You should choose someone you trust implicitly as your financial agent. This person should be responsible, organized, and have good financial judgment. Consider selecting someone who lives nearby and understands your financial goals and values. The agent should be willing to take on the responsibility and have the time to handle your affairs if needed. Many people choose a spouse, adult child, other family member, or close friend. It’s also advisable to name an alternate agent in case your first choice becomes unavailable or unable to serve. In Arizona, your agent must be at least 18 years old and of sound mind.
In Arizona, you can customize the powers granted in your Financial Power of Attorney. Common powers include: managing bank accounts and investments; buying, selling, or managing real estate; handling tax matters; collecting debts owed to you; accessing safe deposit boxes; applying for government benefits; making gifts within specified limits; operating your business; and managing digital assets. You can make the document as broad or limited as you wish. For certain significant powers like making gifts or changing beneficiary designations, Arizona law requires that these powers be explicitly stated in the document. The Arizona Uniform Power of Attorney Act provides a framework for these powers while allowing flexibility to meet your specific needs.
In Arizona, a Financial Power of Attorney can take effect in two ways, depending on how you set it up. An “immediate” Power of Attorney becomes effective as soon as you sign it, allowing your agent to act on your behalf even while you’re still capable of managing your own affairs. A “springing” Power of Attorney only becomes effective when a specific event occurs, typically when you become incapacitated. With a springing power, you’ll need to clearly define what constitutes incapacity, often requiring one or two physicians to certify that you can no longer manage your financial affairs. Most durable Financial Powers of Attorney in Arizona are immediate, as springing powers can sometimes create delays when your agent needs to act quickly.
To create a valid Financial Power of Attorney in Arizona, the document must be in writing and signed by you (the principal) while you are of sound mind. Your signature must be notarized. While Arizona law doesn’t require witnesses for a Financial Power of Attorney, having witnesses can provide additional verification of your capacity and intentions. The document should clearly identify your agent and alternate agent(s), specify the powers you’re granting, and state whether it’s durable (continues if you become incapacitated). Although Arizona provides statutory forms, many people work with an attorney to create a customized document that addresses their specific situation. Once executed, provide copies to your agent, financial institutions, and keep the original in a secure but accessible location.
Yes, as long as you are mentally competent, you can revoke or change your Financial Power of Attorney in Arizona at any time. To revoke a Power of Attorney, create a written revocation document, have it notarized, and provide copies to your agent and any institutions that had the original Power of Attorney on file. Simply creating a new Power of Attorney doesn’t automatically revoke previous ones unless it explicitly states so, which is why a formal revocation is important. To change your Power of Attorney, it’s generally cleaner to revoke the old one and create a new document rather than trying to amend the existing one. Remember to collect and destroy copies of the revoked document to prevent confusion.
An agent under an Arizona Financial Power of Attorney has significant legal responsibilities. They must act in your best interest (fiduciary duty), follow your reasonable expectations when known, and act in good faith. The agent must keep their finances separate from yours and maintain accurate records of all transactions made on your behalf. They can’t change your will or make decisions outside the scope of authority granted in the document. Arizona law specifically requires agents to act loyally, avoid conflicts of interest, and cooperate with any healthcare agents you’ve appointed. The agent can be held legally accountable for breaches of duties. These responsibilities continue until the Power of Attorney terminates, you revoke it, the agent resigns, or either you or the agent dies.
If you become incapacitated without a Financial Power of Attorney in Arizona, your loved ones would need to petition the court to establish a conservatorship to manage your financial affairs. This legal process can be time-consuming, expensive, and public. The court will appoint a conservator, who may not be the person you would have chosen. The conservator will be subject to court supervision, requiring regular reporting and possibly court approval for certain transactions. Additionally, while the conservatorship proceedings are pending, your bills and financial matters may go unattended. Having a Financial Power of Attorney in place avoids these complications, allows you to choose who will manage your affairs, and typically saves your loved ones significant stress, time, and money.
A Financial Power of Attorney validly executed in Arizona is generally recognized in other states, as most states have laws honoring Powers of Attorney properly created in another state. However, practical challenges may arise as financial institutions in your new state might be unfamiliar with Arizona’s requirements and forms. If you move permanently to another state, it’s advisable to create a new Power of Attorney that complies with that state’s laws. Each state has different requirements for Powers of Attorney, such as whether witnesses are needed, specific disclosures, or required language. Creating a new document in your new state of residence ensures maximum acceptance by local financial institutions and minimizes potential complications during times when the document needs to be used.
In Arizona, a financial agent cannot make gifts or transfer your assets to themselves unless the Power of Attorney document specifically authorizes this power. Under the Arizona Uniform Power of Attorney Act, certain “hot powers” like making gifts or changing beneficiary designations require express authorization in the document. Even with this authorization, the agent must act in your best interest and according to your known wishes. Any gifts must be reasonable and consistent with your history of giving or estate plan. If the agent abuses this power for self-benefit, they can be held legally accountable. Given the potential for conflicts of interest, it’s important to carefully consider whether to include gifting powers and what limitations to place on them when creating your Power of Attorney.
Banks and financial institutions in Arizona generally accept valid Financial Powers of Attorney, but they often have their own procedures for processing them. They typically require a review of the original document or a certified copy, verification of the agent’s identity, and sometimes an affidavit from the agent confirming the Power of Attorney is still in effect. Arizona law provides some protection if institutions unreasonably refuse to accept a valid Power of Attorney, but practical challenges can still occur. Some institutions may request that their own forms be used or that the Power of Attorney be recently executed. It’s advisable for your agent to contact your financial institutions before they need to use the Power of Attorney to understand specific requirements. This proactive approach helps avoid delays when the document actually needs to be used.
A Financial Power of Attorney in Arizona can end in several ways. It automatically terminates upon your death (at which point authority transfers to your executor or personal representative). You can revoke it at any time while you’re mentally competent by creating a written revocation. The document ends if your sole agent becomes incapacitated or dies, unless you’ve named an alternate agent. If a court appoints a conservator for your estate, the Power of Attorney may be suspended or terminated. A Power of Attorney with a specified end date will terminate on that date. Non-durable Powers of Attorney end if you become incapacitated. Additionally, your agent can resign at any time. It’s important to periodically review your Power of Attorney to ensure it still reflects your wishes and to update it if circumstances change,
