Many clients have a general understanding of what a power of attorney is. On the other hand, almost no one knows what a power of appointment is. It helps to have at least a basic understanding of powers of appointment for two reasons. First, if someone has given you the power to appoint property, for instance your parent in their estate plan, it is important to note the power of appointment in your own will or trust and understand the ramifications of exercising it or not exercising it. Second, you might include a power of appointment in your own estate plan. For instance, you might want to give a child the ability to appoint to whom their inheritance should pass in the event you left them money in trust and the child dies before the trust is exhausted.
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