The Power of Planning: Knowing When Powers of Attorney Just Aren’t Enough

Years ago, I knew a personal banker who worked in a community with many retirement-aged residents. When they passed, this banker would often have the children of the recently departed sitting in her office ready to close bank accounts and distribute assets. Frequently they would pass her their copy of their loved one’s durable power of attorney and ask that she transfer money per their directions. They were not too pleased when she told them she couldn’t do that because they didn’t have the authority to access the accounts. They mistakenly believed that the word “durable” meant that it went on forever, even after death. Hopefully their loved one also had an estate plan or they may have missed out on the power of planning.

The reality is that “durable” means that the power of attorney stays in effect even if the person is incapacitated and unable to make decisions on their own. This durability does not extend past the life of the person who created the power of attorney. Once a person has passed, new authority must be given to someone to gather and distribute your assets, and this is where estate planning comes in.

The Power of Planning

We often talk to people who say “My kids will figure it out when I am gone.” The reality is that if you do not have an estate plan in place, your kids won’t figure out much, because state laws that govern intestate succession will govern what happens next. (If you want to know more about Idaho intestate succession, you can take a look at Idaho Code §15-2-101 et al.)

If you have an estate and you want to decide where you want your assets to go, you have a two main options:

Create a Trust

A revocable trust allows you to identify people who can manage your assets while you are alive if you are unable or unwilling to manage your own assets, and then continue handling your estate after you are gone. Any asset you have inside your trust (including personal property, vehicles, real estate, checking and savings accounts, investments, etc.) can be handled by the trustee of the trust.

Powers of attorney are used while you are alive to handle anything outside the trust, including retirement accounts and life insurance. Once you have passed, the trustee continues to manage the assets in the trust according to your directions.

Trusts name beneficiaries for after you have passed, and may give specific instructions for how and when an asset is to be distributed. Trusts can also have sub trusts that hold assets for minor or disabled family members.

A trust cannot name guardians for minor children or nominate guardians for disabled family members. A companion will (also known as a pour over will) is used to add any forgotten items to the trust, and/or nominate guardians after your death.

Note: There are multiple types of trusts that are designed to help in specific situations. Speak to an attorney to find the will that will best suit your needs.

Create a Will

A will only becomes effective after you die, so powers of attorney are needed if you want anyone else to have authority to act on your behalf while you are alive. Wills name a personal representative to distribute your estate after your passing.

Wills name beneficiaries just like a trust and may also give specifics on how and when an asset is to be distributed. Some wills create trusts after your death to hold assets for the benefit of minor or disabled family members.

Wills are required to go through the probate process, which gives a judge the ability to read your will and give your personal representative the authority to act on your behalf to follow the terms of your will. Many families use an informal probate process that is quicker than a formal probate process, but all probate goes through the court.

Intestate Succession

If you do not wish to create an estate plan, it is said that you have died intestate, and there are two main options.

After your accounts with listed beneficiaries (such as life insurance, retirement accounts, bank accounts, etc.) are distributed, your heirs can either file probate or file a small estate affidavit.


Probate without a will is similar to probate with a will, except state law governs how the assets will be distributed and disagreements between heirs are governed by intestate succession laws instead of the terms of a will.

Small Estate Affidavit

If you have assets under $100,000, and do not own property (including land or a home), your family may be able to use a small estate affidavit 30 days after your passing. This document is signed in front of a notary. It may then be presented to anyone having possession of your assets after your death (like a bank) so that the asset can be transferred to your loved ones.

There are a few other restrictions on using a small estate affidavit, so it is good to talk with an attorney to determine if this option makes sense.

Whichever path you choose, knowing the options, and the limitations of those options, is an important first step to developing a plan for after you are gone. While it is possible to find quick online options for wills and powers of attorney, it is important that you understand how those options will work with your specific circumstances.

Working with a lawyer to set up your estate plan ensures your get a plan tailored for your needs. If you have any questions about creating an estate plan in Idaho, take a look at out estate planning information and frequently asked questions.