If you ask any adult these days, many are familiar with the concept of “Power of Attorney”. Although they may be familiar with that concept, it is helpful to be reminded how they work and what types are available.
A Power of Attorney can easily be characterized as a written authorization that you sign to allow someone else to act on your behalf to manage your private affairs. The two main categories of these types of documents are “Financial Power of Attorney” and “Healthcare Power of Attorney”.
A Financial Power of Attorney allows the person or persons that you select (your agent) to act on your behalf with regards to any financial transactions. Many people are uncomfortable with the idea of allowing someone else to have control over their finances. But remember, this document does not allow that person to act in bad faith and they must act for your best interests. Most importantly, if you have this document in place in the event that you happen to become incapacitated, whoever you have previously appointed as your agent may act seamlessly in managing your affairs. The alternative to a Financial Power of Attorney is a guardianship. Guardianships can be costly, humiliating, and will ultimately result in you losing all of your decision making power to whomever the court appoints.
A Healthcare Power of Attorney works in very much the same way. You choose who you want to make healthcare decisions if you are not able to make them on your own. With healthcare costs rising, healthcare technology improving, and families growing and changing, it has never been more important to create a Health Care Power of Attorney. In doing so, you will be able to know with certainty that there is a person you trust making healthcare decisions for you if you cannot make them yourself.
Both the Financial Power of Attorney and Healthcare Power of Attorney are integral aspects of an estate plan. With these in place, you can be confident that all of your affairs are handled by the person or persons you trust with your best interest in mind. A qualified estate planning attorney will be able to assist you in creating these important documents.
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