A Power of Attorney (PoA) is a legal form that you use to elect someone else, called an agent, to act on your behalf.
If you’re unable, as a result of injury or illness, to make decisions for yourself, a Power of Attorney can help manage your financial and medical affairs.
Today, we will help you better understand what a PoA is and how to choose an agent you trust to ensure your future is planned for.
4 Types of Power of Attorney
There are four types of Power of Attorney that can be granted in various circumstances.
1. General Power of Attorney
A General Power of Attorney gives your agent the ability to make any and all decisions that you couldn’t otherwise make.
This power can be extensive and includes the ability to:
- Pay bills, collect money owed to you and deposit or withdraw funds from your accounts.
- Buy or sell properties on your behalf.
- Make investments for you.
- Do or have done any other act necessary to carry out the power.
2. Special Power of Attorney
A Special Power of Attorney can be limited in time or scope. For example, your Power of Attorney could allow you to appoint someone to handle just one task – such as specific financial transactions, medical decisions, or other finite tasks.
3. Health Care Power of Attorney
If you grant Power of Attorney for health care purposes (called Power of Attorney for health care), this document allows your agent to make health care decisions on your behalf.
A Power of Attorney for health care can also allow the power holder to transfer a registered Lifetime Power of Attorney (LPA) you’ve previously signed over to them.
4. Durable Power of Attorney
A Power of Attorney can be set up to continue even if you become unable to make your own decisions — this is called Durable Power of Attorney.
A durable Power of Attorney allows the power holder to act on your behalf, even when you’re no longer able to do so on your own due to illness or injury. A Durable Power of Attorney stays in effect until either you or your agent dies.
6 Frequently Asked Questions About Power of Attorney
If you’re considering a Power of Attorney, we’re sure you have many questions. We’re going to address some of the most common ones that we encounter to help you make the right decision for yourself.
1. How Do I Choose The Right Type of Power of Attorney
If you’ve been diagnosed with a medical condition, and your Power of Attorney will only be in effect for a short time, you may want one that’s limited in scope.
If you don’t have a specific Power of Attorney in mind and just want someone to make decisions for you should you no longer be able to do so for yourself, a Durable Power of Attorney may be best.
2. Who Can I Appoint as My Agent?
Any adult can be appointed Power of Attorney, and there are no limits on where they reside. You don’t have to choose a family member if you don’t want to.
However, you must choose an agent who understands your situation and circumstances so they can act on your behalf effectively.
Perhaps the most important aspect of choosing your agent is verifying that it is someone you trust implicitly. Your agent will have a great deal of authority over all that you grant them access to, and it is crucial that you ensure they will act responsibly and in your best interest.
3. Does My Agent Have Complete Power Over Me?
A Power of Attorney doesn’t have to give your agent complete control over all aspects of your finances and medical decisions.
Instead, you can explain exactly what your agent can and cannot do under the power — this is often called a Limited Power of Attorney.
4. What If My Agent Is Unable To Make The Decisions I Need?
You don’t need to do anything if your agent can continue making decisions on your behalf – such as if they’re in the military and called overseas for active duty.
If your agent becomes unable to make decisions, you have two options: You can cancel the Power of Attorney or name another agent.
5. When Do I Appoint A Power Of Attorney?
We recommend that you discuss this with a legal professional before filling out any paperwork. Don’t feel rushed to create a Power of Attorney right away – start thinking about it now and discuss your options with a legal professional with experience in estate planning to see if now is the right time to create one.
6. What If I Change My Mind?
You can change your Power of Attorney at any time – as long as you have the mental capacity to do so and it’s not limited in scope. You must cancel the out-of-date Power of Attorney, appoint a Power of Attorney for different purposes, and create a new Power of Attorney document.
Talk to Our Legal Professionals
A Power of Attorney allows you to give someone else control over your finances and/or medical decisions for when you cannot make those decisions, and it isn’t a decision that you want to take lightly or rush.
At Valley Divorce Services, from family law to estate planning, our legal document preparation services offer an affordable option for legal document help!
Our legal professionals can help with compiling documentation for obtaining power of attorney (PoA) or provide notary services for PoA documents. Request a free legal consultation today for more information on how we can help you plan for the future.