A power of attorney is an authorization to act on someone else's behalf in a legal or business matter. A financial power of attorney or durable power of attorney for finances is more specific. It is a way for someone to legally manage your finances if you become unable to do so yourself.
A financial power of attorney can be broad or limited. For example, you could grant a financial power of attorney to sell a car or house, or to buy and sell securities, or to handle all of your finances.
A financial power of attorney can go into effect as soon as you sign it, or you can specify that it doesn't go into effect until a specifically defined event occurs such as a doctor certifies that you are incapacitated (called a "springing" durable power of attorney).
If you become incapacitated and don't have a durable financial power of attorney, then your family will probably have to ask a court for authority to handle your affairs.
Your durable financial power of attorney ends when you die.
Legal experts typically assert that most people should have a durable financial power of attorney. To ensure that you are appropriately covered, you should consult a legal professional.
You may need to make more than one durable financial power of attorney because some financial institutions (including brokerage companies) have their own durable power of attorney form.