What is a Power of Attorney (POA)?
Being proactive and planning for the unexpected in life gives you some control over the outcome and peace of mind. This is true of end-of-life decisions. A power of attorney is a legal document that permits another person to act on your behalf if you become incapacitated or pass away.
There are different types of power of attorney so that you can establish broad or specific terms, including decisions regarding your medical care and finances. The five kinds of POAs include durable POA, springing POA, general POA, financial POA, and medical POA.
With a power of attorney, or multiple POAs, you can choose the level of involvement and authority you want another person to have over you. This is typically a significant other or spouse.
Our attorneys with Fuller Law Practice can help guide you through the estate planning process, which includes a power of attorney. Experienced legal counsel and support will ensure you make the right choice for yourself and your family.
What Are Types of POAs?
A power of attorney is a powerful document that allows an agent or proxy to make decisions on your behalf. When drafting a power of attorney, you can choose from different types of POAs depending on the level of authority and specific affairs you want another person to manage.
- Durable POA: A durable POA allows your agent to act on your behalf if you become incapacitated due to a severe health issue or accident. In a coma, for example, you will need someone to make quick decisions for you.
- Springing POA: A springing POA gives your agent the power to act only when you’ve become incapacitated and can’t act for yourself. It is condition specific. Outside of this, there is no legal authority over your affairs.
- General POA: With a general POA, your agent can make decisions in multiple areas, including legal, financial, health, and business matters. While a general POA affords a person considerable power, they cannot make changes to your will or enter into a marriage on your behalf.
- Financial POA: Considered a limited power of attorney over your finances, you can give your agent authority over your money and property, from paying your bills to making bank deposits to selling your real estate and filing taxes. A financial power of attorney does not give a person access to other decisions.
- Medical POA: Another type of specialized POA, medical power of attorney, allows your agent to make healthcare decisions on your behalf. This might include medical treatments, end-of-life care, surgery, and medical treatments.
Think of a power of attorney like insurance coverage or a limited liability policy—you can make it as comprehensive and broad or as narrow as you’d like. Having this protection also can prevent disputes among family members during times of crisis, as well as reactive, emotional decision-making.
Who is the Best Person to Choose for a POA?
Most people start seeing the benefits of a power of attorney after a health diagnosis, before getting surgery, or when faced with a health scare.
A power of attorney is an important fiduciary responsibility. The person you choose for the role should be trustworthy, reliable, and capable as they will make vital decisions on your behalf related to your finances, medical treatment, and more.
With this in mind, it’s not unreasonable to consider multiple people for a different power of attorney roles. Some require specific skill sets, such as a financial power of attorney. If your spouse or significant other, for example, isn’t comfortable managing finances, it will likely be an added burden to put them in this position.
Choosing a person (or people) is not about who is “closest” to you. Your agent or agents must be willing to entertain your specific wishes and follow through—even if they disagree. The person’s ability to respect and execute are two things to look for, as well as assertiveness and willingness.
It helps to have a non-biased perspective when considering a power of attorney—this is something attorneys with Fuller Law Practice can help with as part of the estate planning process and power of attorney creation.
How Do I Start a POA?
The first step to creating a power of attorney is selecting an attorney to help design a comprehensive estate plan to protect your assets, family, and end-of-life decisions. A power of attorney is an essential legal tool as part of the estate planning process.
Before the process starts, we encourage our clients to have open conversations with family members, friends, and loved ones regarding designations related to executors, trustees, and agents. Hence, everyone is aware and can agree to their role.
We will help you determine the right type of power of attorney based on your needs and help with decision-making related to any critical assignments before starting the paperwork and filing process to make everything official.
Establishing a power of attorney—as part of the estate planning process—can be the first step to better managing the unexpected in life and ensuring you and your family’s peace of mind in the long run.
How Many POAs Do I Need?
The singular most important decision when choosing one or more power of attorney is trustworthiness. This person or people will be entrusted with many responsibilities and will also have access to some—or all of your property and money. You and your family are bound to this decision, and your family will bear the brunt of any negligence.
If choosing a general power of attorney, your agent will be authorized to make multiple decisions on your behalf. This is a broad type of coverage, from financial decisions to healthcare to business matters. If there is one perfect person to manage this on your behalf, you might not need to consider another power of attorney.
However, as different people have different skill sets, it can be valuable to have two separate powers of attorney—one for financial and one for health care decisions, for example. Additionally, you can name a second agent—or a backup—if your first choice dies.
Attorneys with Fuller Law Practice can discuss the benefits and disadvantages of different POAs and use one or more agents to facilitate your plans. Start with an initial consultation to discuss your options with our experienced attorneys. Call: (702) 935-4144.