During the estate planning process, you may be offered the opportunity to add a power of attorney (POA) as part of your plan. In short, a POA is a person who has the legal authority to essentially act on your behalf and make decisions when you are unable to. As you might imagine, this individual has a great deal of power, so you must designate and delegate the authority of a POA wisely.
Designating a power of attorney should be less about the relationship and more about trust. Depending on how power is delegated, this individual will have the potential to make many of your decisions should you become injured or ill and unable to handle your affairs on your own.
Worry less about offending someone if you do not pick them as your POA and think about the person who you know will always consider your wishes and have your best interest in mind. Keep in mind, someone with a criminal record can serve as a POA, but their criminal background generally needs to be documented at the time the POA is executed. If it is not, the agreement could be voided.
Delegation of Power
The powers that the POA has are determined by the type of power of attorney document you select. The most far-reaching option is the durable power of attorney, which generally does not expire until the individual passes away and may allow the individual to do everything from changing a beneficiary on a life insurance policy to making medical decisions.
There are also more specific options, such as a financial or medical power of attorney, which limit delegation to certain matters. An attorney can review your estate needs and lifestyle factors to determine what type of power delegation is necessary.
It is important to consider when the power of attorney will be activated. You typically have two options when it comes to estate planning: an immediate activation or one that is dependent on your status. With an immediate POA, once the document is notarized, the individual is delegated the full powers listed in the document.
For one that is dependent on status, it does not take effect until a specific event, such as not until your health has declined to the point that you are no longer able to make sound judgments.
As such an important decision, it is a good idea to sit down with an attorney to discuss your situation. Contact a company like Cirrus Law PC to learn more.