What You Need To Know About Creating A Power Of Attorney
Important decisions are made on a daily basis. What would happen if you were unable to make these important decisions for yourself due to injury or mental impairment? A power of attorney is a critical part of the estate planning process because this document can determine who will handle your affairs when you are unable to do so.
You will need the help of an attorney to create a power of attorney that can stand up to legal scrutiny and that will reflect your desire to have a specific individual make critical decisions on your behalf.
If you understand what a power of attorney is and how this document works, you will be able to utilize a power of attorney as an effective tool in planning your estate.
What Is a Power of Attorney?
A power of attorney is a written document that gives decision-making authority to any individual you want handling your affairs in the event you become physically or mentally incapacitated. Power of attorney documents can apply to short-term impairments or function as long-term authorizations, depending on the circumstances you find yourself in over time.
Your attorney will have you identify a loyal and trusted friend or family member that will be named as your agent or attorney-in-fact. You will then work with your attorney to identify the scope of your power of attorney agreement.
Some people choose to discuss their power of attorney documents with the agent they have chosen, while others prefer to keep their agent confidential.
Without a valid power of attorney in place, it is possible that your decisions regarding your finances, healthcare, and assets will be handled by a court-appointed official instead of someone that you know and trust.
Are There Multiple Types of Powers of Attorney?
Deciding who you want to make decisions on your behalf isn't always easy. You may feel that one person is qualified to make informed decisions regarding your business matters, while a different individual would be more apt to make healthcare decisions that are in line with your own wishes.
Fortunately, it is possible to customize your power of attorney to meet your unique needs. A limited power of attorney grants an individual the power to act within a specific area of your life. You can create separate limited powers of attorney for each area of importance.
You also have the ability to work with your attorney to create a durable power of attorney. This type of document is designed specifically to remain in place in the event of your cognitive decline.
No matter which type of power of attorney document you choose, your attorney can help you ensure that the individual of your choice has the legal authority to make critical decisions in your future.
Is a Power of Attorney Permanent?
Once you have drafted and executed a power of attorney document, the document will remain valid until it is altered or revoked. It's important that you revisit all of your estate planning documents with your attorney on a regular basis to ensure they still reflect your wishes.
You retain the authority to change your designated agent or revoke multiple limited Powers of Attorney at any time.
If you are worried about having someone abuse your power of attorney, you can include a stipulation that requires a doctor of your choice to submit documentation agreeing that you are incapacitated before the power of attorney can be invoked.
This type of clause will guarantee that someone else makes your decisions only when you are no longer medically able to do so.
Talk to your estates and trusts attorney about adding a power of attorney to your personal estate planning documents today.