A power of attorney (POA) is a document that lets you appoint a person or organization to manage your financial or medical decisions on your behalf if you are unable to for any reason. This person or organization is called an “attorney-in-fact” or “agent.” Your power of attorney should be given to someone with whom you can trust your life.
The formal document outlines the amount of power this agent will have over you, your property, or both. The agent takes full responsibility for the choices made under the power of attorney guidelines. Anyone can be given power of attorney, but most commonly are a spouse, relative, or best friend. However, giving someone a POA makes it easy for them to misuse this power, especially if the principle is not in the right state of mind. Given that, make sure to not give the power to anyone you don’t know well or whom you feel may abuse the situation.
What Does Power Of Attorney Do?
There are many different reasons why someone would need a power of attorney to take over in certain situations:
- Making financial decisions
- Settling claims
- Operating business interests
- Protecting or claiming personal or estate assets
- Making health or medical decisions, including the ability to withhold or stop medical procedures, treatments, and services
A power of attorney isn’t just a simple document that covers everything. Depending on the situation, there are two main types of power of attorneys, a general power of attorney and a special power of attorney, which will be called different things depending on what powers are awarded to the agent, such as a medical power of attorney or a financial power of attorney.
Why Is POA Necessary?
Creating a power of attorney with the intentions you would like it to accomplish is always a good idea if you have an estate, financial property, or anything you would not want to get into the wrong hands if your life ends too soon or you are otherwise unable to manage your personal affairs. Close family members or spouses are usually deemed as an agent in conditions when a family needs to make the decision to keep the principle on life-support or not, for example, that way doctors won’t have the first say.
Setting Up Power Of Attorney
The first step to getting a power of attorney is to contact an expert in this field. In addition, there are certain requirements for obtaining a power of attorney for mentally unstable adults or minor children that would require a physician’s signature or a temporary form.
Once the power of attorney is signed, it goes into full effect. However, if you ever move to another state, consult with a local attorney to guide you on your state’s requirements to ensure it is still valid if you do not have recorded proof of its creation.
Renewing Your Power Of Attorney
States have different laws regarding power of attorneys. If you have recently moved to a different state, or if you have not looked at your power of attorney for several years, you should have an expert in this field look at your power of attorney to make sure your current wishes are articulated well.
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