Why Do I Need a Power of Attorney?

What are Powers of Attorney?  

 Powers of Attorney are important legal documents whereby you can designate surrogate decision-makers to act on your behalf. There are two types of Power of Attorney documents: ones for health care purposes and ones for financial purposes. Under a Health Care Power of Attorney, you can appoint an agent to make medical decisions for you in the event that you are unable to make or communicate those decisions yourself. Under a financial Power of Attorney, you can appoint an agent to conduct financial affairs and make financial transactions on your behalf.  The appointed agent has an obligation to act in your best interest.

When are Powers of Attorney effective? 

A Health Care Power of Attorney becomes effective when you are no longer able to make and communicate medical decisions. The document can specify whether one or two physicians are required to activate the Health Care Power of Attorney. 

A financial Power of Attorney can be effective upon signing of the document, or it can be effective if you become incapacitated and unable to manage your financial affairs. A financial Power of Attorney that becomes effective upon incapacity is known as a “springing” financial Power of Attorney.

What does the term “Durable” mean?

The term “durable “means that a Power of Attorney document does not terminate if you become disabled and incapacitated. A Power of Attorney must include specific language about durability in order for it to be a durable Power of Attorney.

Can a Power of Attorney be used after I die?

For most purposes, a Power of Attorney can no longer be used after the person who signed the Power of Attorney passes away.

What happens if I don’t have a Power of Attorney?

If you don’t have Powers of Attorney in place, and you become incapacitated, your loved ones may need to seek a guardianship and/or conservatorship with the probate court in order to have authority to make medical and financial decisions on your behalf. A Guardian is a person appointed by the court to make medical decisions on behalf of someone who is incapacitated. A Conservator is a person appointed by the court to make financial transactions on behalf of someone who is incapacitated.

What are the benefits of having a Power of Attorney?

By executing Powers of Attorney, you can ensure that there is someone who has legal authority to make medical and financial decisions for you if you should be unable to do so. You can decide who your decision-makers are, and under what circumstances they can act on your behalf. Because the appointment of a guardian and/or conservator is a court-supervised process, you can avoid the need for court involvement in the event you become disabled and incapacitated.

 Conclusion 

Powers of Attorney are important legal documents. These documents help you prepare for circumstances when you have become incapacitated and are not able to make decisions on your own. Talk to your estate planning attorney about incorporating these documents into your estate plan.