Giving someone a Power of Attorney can have signification ramifications if you select the wrong instrument. Let us help you make an informed decission.
A Power of Attorney is a legal document you use to sanction another person to act as your agent, or make a decision on your behalf, on any matter that can have a legal or financial impact on your future. This document specifically delineates what powers, limited or broad, you give to your delegate when acting on your behalf. For example, if you are in the process of buying a house but you are unable to attend the closing, you can give your spouse or friend permission to sign the deed in your absence through this type of document.
A Power of Attorney is different from a will or a trust in that becomes void in the event that a person passes away or become mentally incapacitated as a general rule. A will or trust generally become effective the moment a person passes away.
- General Power of Attorney: is an effective tool if you will be out of the country and need someone to handle certain matters, or when you are physically or mentally incapable of managing your affairs. A general power of attorney is often included in an estate plan to make sure someone can handle financial matters.
- Special Power of Attorney: is a tool where an agent is given power to act within a limited scope or purpose. This document is commonly used when a person cannot be present at a certain event due to other commitments or for health reason. Some examples are the selling or buying of property, collecting debts, or handling of a business transaction on your behalf.
- Health Care Power of Attorney: grants your agent the authority to make medical decisions on your behalf in the event that you become unconscious, mentally incompetent, or otherwise unable to make decisions. It is not the as a living will since this document specifies who can make decisions for you but not what those decisions should be. Many people will have both a living will and a health care power of attorney in the event that they are sick or elderly and want to manage the level of care they receive.
- Durable Power of Attorney: unlike a general power of attorney, a durable power of attorney survives or remains in effect even in the event you become mentally incompetent due to illness or accident. This is simply a general, special, or health care POA that has a durability provision to keep the current power of attorney in effect.
A Power of Attorney can be very helpful to you and your family. Please let us help you pick which document will protect you and your family the best based on your situation.