Today’s post in my series about Estate Planning Common Questions concerns a legal document called a Power of Attorney. First, a Power of Attorney is providing legal authority to someone else to act on your behalf. Clearly, you would choose an individual you trust to act in your best interests, whether it is related to your health or finances. Remember that you might want two individuals, one for your Healthcare Power of Attorney and a different one related to finances and so forth. A real-life example: a friend’s sister had a person with whom she had a close relationship over the years chosen for her health care power of attorney. This person was also named in her living will. Over the years, that person changed their views on life, death, etc. The friend’s sister realized that if she was in a medical situation where things were dire, perhaps in the hospital with no expectation of surviving without artificial life support, her friend might not be trusted to follow her directions and discontinue treatment. So when choosing the person or persons, you need to ensure they can follow your directives.
The following is a review of the many ways a Power of Attorney (POA) can be beneficial to you and your loved ones.
- Incapacity. Suppose you become incapacitated for any reason, such as injury, illness, or old age. In that case, the appointed individual can step in to make decisions you would typically have made.
- Finances. The POA allows this individual to pay your bills, access your bank accounts, and more. This benefit can ensure your monthly bills are still paid on time, for example.
- Healthcare. This is a significant benefit of having a POA, usually called a Healthcare Power of Attorney. If you are hospitalized, unable to speak for yourself, and the medical care team needs permission to proceed with treatment, your trusted agent can provide that permission or not, based on what is in your best interest.
- Business. Suppose you are an “in-demand” business owner or high-level executive. In that case, you already know you can’t be in two places simultaneously. When it comes to signing essential contracts or making key decisions, having an agent you’ve authorized to do that for you can be a real-time saver.
- Travel. If you are a frequent traveler or live abroad some of the year, having an agent you’ve appointed back home can be very convenient. Maybe you’re selling some property, and someone needs to attend the closing, but you’re in Europe. Your agent can do that on your behalf.
If you have already established your financial and medical Power of Attorney documents – great! However, please take a minute to review those documents. Is that individual, or those individuals, still the right people for the task?
Unfortunately, people die, or we part ways with those we thought would be friends forever. Imagine you appoint a close friend as your POA agent only to have a major falling out two years later, resulting in an adversarial relationship. It can happen. You most certainly do not want that individual to have access to your bank accounts or make medical decisions on your behalf. That’s why I offer my clients a complimentary review of all the estate plan documents every three years. Let’s talk about how a Power of Attorney can benefit you. I can be reached at 513-399-7526 or through my website, www.davidlefton.com.