As you make your estate plan, one thing you may consider is setting up a power of attorney. When you do this, the documents allow you to choose an agent. You are giving them – the agent – the power to make decisions for you.
The general reason that people do this while estate planning is because they recognize that they might become incapacitated. They may not pass away, but they could suffer from something like a heart attack or a stroke and be stuck in a hospital. Someone needs to be able to act on their behalf while they recover.
Financial power of attorney
A financial power of attorney, often called a legal power of attorney, focuses on accomplishing goals that no one else could typically do for you. For example, only you are supposed to have access to your bank accounts or pay off your property taxes and income taxes. But you can use a power of attorney so that someone else can make these payments and take care of crucial documents if you’re not able to do so on your own. After all, a lot of these things have deadlines that need to be met.
Medical power of attorney
A medical power of attorney, on the other hand, focuses on your healthcare decisions. Doctors need to know if they should resuscitate you, for example, or if you’re opposed to any certain types of care. They may also have to make quick decisions about what type of medical treatment to use in an emergency. You may not be able to make these choices on your own, but your agent has the legal power to do so, giving your medical team the opportunity to work toward your best interests.
You can see just how useful these documents can be, and it’s very important to get them in place in advance. You may need to be sure you know what legal steps you’ll need to take.