For most people, the idea of estate planning means just creating a will so that their surviving loved ones will know what should happen with their property. However, an estate plan can include far more than just a will and focus on more than just topics related to after-death matters. In fact, you can use your estate plan to detail how you want certain matters handled while you are still alive in the event that you cannot handle them yourself.
In particular, you may want to consider including a power of attorney document in your estate plan. The possibility exists that anyone could become seriously injured or ill, or otherwise suffer an incapacitating event and need someone else to handle his or her personal affairs. You undoubtedly do not want just anyone in charge.
What is a POA?
A power of attorney document allows you to appoint someone, known as an agent, to act on your behalf in the event that you do not have the ability to make sound decisions. You can appoint an agent to handle your financial matters or your medical matters, and you can name the same person to handle both areas, or choose a different agent for each.
When does your agent gain control?
You may worry that, if you create this type of document, you will essentially hand all of your personal control over to another person. Fortunately, that is not the case. If you wish, your agent can act on your behalf in situations that are not dire, such as giving your agent the ability to sign important documents if you cannot be present yourself. This way, you have someone who has the authority to help you handle important matters in your busy life.
You can choose to create a durable POA that would allow your agent to continue to act on your behalf after incapacitation, or you could implement a “springing” POA that would give the agent the ability to act only after an incapacitating event (meaning that your appointed agent could not act on your behalf before that time).
Whom should you choose?
You likely understand how important it is to choose the right person to act as your power of attorney agent. Therefore, you should give the appointment a considerable amount of thought before choosing just anyone. If you would like more information about the responsibilities and power your agent could have, you may want to discuss this topic with an attorney.