What is a Power of Attorney?
Power of attorney is the process of creating the legal document and designating someone to manage your property (finances) and affairs in the event that you are no longer able to do so. This applies if you become ill or otherwise incapacitated.
There are three types of powers of attorney: general, durable, and limited.
A general power of attorney is the broadest type. The designated person is empowered to handle business and other financial transactions, settle claims, and employ professional help. Many people may designate a general power of attorney if they are overseas for some time and need someone to handle their business or other affairs.
A durable power of attorney is useful when a person becomes incapacitated. 83% of people aged 72 and older have designated a healthcare power of attorney while 41% of millennials have a healthcare POA in place. A durable power of attorney provides the designee the capability to make healthcare and financial decisions. These are the most common powers of attorney that we produce for our clients.
A limited power of attorney, also known as a “special” power of attorney, appoints an agent for specific purposes. This can include real estate transactions, debt collections, and other matters. In appointing a person with limited power of attorney, the situation must be outlined specifically as to what the person can or cannot do.
The Importance of Powers of Attorney
Power of attorney is important because it empowers people who are handling important affairs in your life. Whether it has to do with your property, financial transactions, or your health, if something happens to you, you are trusting this person with important matters.
Planning ahead for powers of attorney is important because you want to make sure that someone you trust is going to handle everything instead of someone who may not have your best interests in mind.
Factors to Consider
In choosing who you want to give power of attorney, there are two major things that you should consider:
- Location — The person you appoint should live near you if they are there for health reasons, or located in the city where the affairs need to be handled.
- Trustworthiness — You should make sure that you trust this person to work and advocate for your best interests.
Trust a Skilled Lawyer
The decision of who to appoint for power of attorney, whether general, specific, or durable, is not one that should be taken lightly. From choosing who you will designate to getting the papers executed, having a knowledgeable attorney guide you through the process will help put your mind at ease so that when the time comes, everything will be handled and executed accordingly.