If you have been thinking about your estate plan lately, you may be wondering the same thing that many other people ask, "do I need a power of attorney?"
Of course, you may also be wondering what can a power of attorney do, is one really needed and when would you need to name them?
Why do I need a power of attorney?
Power of attorney is a legal document that gives another person who is called an agent or attorney-in-fact, the ability to make decisions on your behalf. These decisions can range from financial matters to certain choices involving your medical care. You can choose from either a general or limited power of attorney.
A limited power of attorney grants the agent the ability to authorize a specific duty, such as finalizing a real estate deal. A general power of attorney will cover a wide range of duties the agent can handle on your behalf including financial matters or medical decisions.
When does a power of attorney go into effect?
When a power of attorney takes effect depends on the type you choose. There are two different types:
- Springing power of attorney - This type will go into effect only when you become incapacitated in some way. Your incapacitation will need to be proved, usually by a doctor.
- Durable power of attorney - A durable power of attorney goes into effect as soon as the document is signed. It will give the agent the authorization to act on your behalf at any time until your death with your permission or if you become incapacitated in some way, for example a coma or vegetative state.
Who should I choose to be my power of attorney?
The easiest way to pick your power of attorney is to choose someone who you fully trust and you feel has integrity. This person will need to represent you in the way that you would want, not how they believe a decision should be made. Just know that you can always update your power of attorney document and change who you want to have as your agent.
Do I really need a power of attorney?
Every person over the age of 18 should consider having a power of attorney. Once over the age of 18, parents no longer have the legal right to make decisions for you. Your power of attorney can be a parent if you wish.
Does a power of attorney continue after I die?
Your power of attorney will not continue after your death. Once you die, the power of attorney duties of your agent will cease to exist and the executor of your estate will handle the legal and financial matters according to your will.
If you are about to start your estate planning and are wondering about having a power of attorney, it is best to speak with an estate planning professional who can answer all of your questions about everything that a power of attorney can do.