Preparing for Your Future? Consider a Health Care or Medical Power of Attorney

If you have already reached the prime of your life, it is a wise move to create a power of attorney that designates a trusted person who will make choices regarding your health care and finances on your behalf when you are no longer mentally capable of doing so. That person, which is also called the attorney-in-fact or agent, can be a relative or a friend and doesn’t necessarily have to be a lawyer. You can grant a medical, health care, or both types of powers of attorney to secure your future as well as your health and assets.

Medical powers of attorney particularly involve medical care decisions that agents make for their principals. You still need one even if you already have drafted a living will. Medical powers of attorney and living wills are two different legal documents. The former merely authorizes a person to make important medical care decisions such as those regarding use of life support when the principal is mentally incapable of doing this for himself or herself. On the other hand, a living will indicates what a person wants to happen regarding his or her medical care when time comes life support is necessary.

Medical powers of attorney are not only beneficial for elderly people who are suffering from serious diseases. Younger people who have had an accident or are suffering from a health problem that renders them unconscious can also use these powers of attorney. In any case, you can choose a person who you trust the most to decide on your behalf according to the available information at that time.

That person who you assign as your agent must perform whatever you require even if it runs contrary to his or her own wishes for you. If you want something to happen in a specific situation in the future, your agent must follow your orders even if it is against their will to keep you alive despite your health condition.

Choosing an agent who will make medical care decisions for you is not enough. You also need to discuss with your agent your wishes in specific instances such as the kind of medications you want and don’t want to take when you are unconscious. In doing so, you can rest assured that everything goes smoothly as you planned when you are mentally incapacitated.

Another power that you can grant to a trusted person concerns your health care. Health care powers of attorney refer to legal documents that designate someone to make financial decisions for your estate should you become disabled, in which case you cannot make decisions on your own.

Once you become mentally disabled, your agent gains responsibility of handling all your finances. An agent or attorney-in-fact who handles your health care differs from a successor in a living trust. The agent is allowed to manage your finances while you are still alive, while a successor gains control of your assets only after your death.

Illnesses can happen to anyone at anytime, so it is important to have a medical or a health care power of attorney while it is still early rather than to let your family members become confused about making decisions regarding your medical and health care.

Power of Attorney: A Brief Overview

The power of attorney may seem like a legal jargon that only those who are well-versed in the technicalities of the law could understand. That is usually the case if you have encountered this term for the first time. However, nothing is complex or incomprehensible about it.

The term refers to a legal document that allows you to appoint someone who can make important choices for yourself when time comes you can no longer do it for your own. The person you appoint may be a family member, a relative, or a friend whom you are confident enough to make the best choices for you, especially when it comes to decisions regarding your health and finances. If you designate someone whom you trust as your agent, you can have peace of mind that the person can make decisions for you according to your best interest. The agent is also called the attorney-in-fact. Do not be misled by the term, though, because an attorney-in-fact does not have to be a lawyer. Your document also has to be tailored to your particular needs and wishes so that you have nothing to worry about in the future.

To put it simply, this legal term is a medium for granting an individual the right to make medical, financial, and other decisions on your behalf. Easy to understand, isn’t it?

The authority to manage another person’s affairs may begin immediately or only when the principal can no longer make decisions on his or her own. The latter scenario happens when the principal is out of the country for a while or when he or she becomes mentally incapacitated.

Granting someone a legal authority to decide on your behalf does not necessarily mean you cannot make decisions for your own anymore. It only means that at the same time, another person can also make choices for you—so you are sharing the right to decide with your agent. For example, if you are on a business trip abroad, you can designate someone to pay your bills or do bank transactions on your behalf. Your agent will only follow your orders, so long as you are mentally capable of making decisions for yourself. The agent also takes charge of keeping and organizing records of all transactions he or she made on your behalf.

As the principal, you have the power to decide the amount of authority you will grant to your agent. You can appoint him or her to manage most of your financial and personal affairs or to handle only a specific aspect of your life.

The laws regarding power of attorney vary from one state to another. However, a number of guidelines are common among states, and these rules must be strictly observed by both the principal and the agent. For example, two legal requirements must be met. First, the agent must not be mentally disabled and is not easily influenced by others. Second, at least two witnesses must sign the documents. Thus, you must discuss all the applicable state laws first with a lawyer before you and your agent sign any document.

Power of Attorney: What to Consider in Choosing an Attorney-in-Fact

Are you having difficulty choosing your attorney-in-fact? Of course, the choices may seem obvious to you: your spouse, child, brother, sister, or friend. But deciding whom you will entrust your assets, money, and health (even your life) can be very tough. To make the selection process a bit easier for you, take heed of the following considerations that you must include when nominating a person in your power of attorney.

• Age – It is a basic factor in determining whether someone is fit to become your attorney-in-fact. You must choose a person who is a lot younger than you are since he or she can carry out the responsibilities for a longer time compared to the older ones. Also, younger people are relatively healthier than their older counterparts, so you can be sure that they can handle your assets without much hassle.

• The person who can do the duties – Typically, elderly people appoint their eldest child as their agent. But how can you be so sure that your child will be able to perform all the responsibilities? If you have more than one child, it would be wise to divide the POA among the children who can handle the duties you require. Also, it helps to assess your children to determine which ones can decide according to your best interest or your wishes. That means going for someone who will manage your finances and personal matters just as you would have.

• Trust – Your level of trust matters a lot when deciding whom you will authorize to make important decisions on your behalf. Ideally, this person should be someone whom you trust your life with.

• Comfort – The person you will choose to be your agent must be someone who you are comfortable dealing with. On the process of drafting the power-of-attorney document, you will have to discuss all the terms in it, and it is important that the agent won’t be too much of a headache for you.

• Amount of control – How much authority are you willing to grant to your agent in terms of decision-making and performing your tasks on your behalf? That is a crucial decision you need to address when selecting the right attorney-in-fact. You may opt for several limited powers of attorney if you are not comfortable with the idea of giving your agent full control over your assets and personal matters. Limited powers of attorney assign particular tasks to an attorney-in-fact. You may even opt to set a specific period for the authorization to take effect.

• Legal requirements – A person must meet certain requirements according to the laws in your state. One of the requirements in most states is that an agent should be of sound mind to be able to make the right decisions when it comes to the finances, properties, or health of his or her principal.

Creating a power of attorney gives you an assurance that nothing will go wrong with your assets and finances and that your wishes will be carried out just as you planned. Part of that peace of mind comes from choosing the best person who will serve as your attorney-in-fact.

Essential Information about Durable Power of Attorney

A durable power of attorney is a practical option for an elderly who wants to plan how his or her properties, business, and other affairs will be managed when time comes he or she is mentally unable to do so. It is especially useful for people who are suffering from a debilitating health condition such as Alzheimer’s disease or are going to stay in a nursing home.

Right after you and your agent have signed the documents, the durable powers of attorney take effect until they are revoked by the principal. The document is terminated at the death of the principal. Durable powers of attorney are named that way because no additional corrections to the documents are necessary once the principal becomes mentally incapacitated. Thus, this type of powers of attorney is an enduring one since it remains in effect even if the principal is mentally incapable of making decisions for himself or herself.

Durable powers of attorney are classified into two general types: health care and financial. As the name suggests, health care durable powers of attorney authorize a person, who is called an agent or an attorney-in-fact, to make all the needed choices regarding health care and hospitalization on behalf of the principal. The decisions can be made by the agent once the principal is no longer able to do it for himself or herself. This type of durable powers of attorney takes effect when the principal has become mentally incapacitated or has a terminal disease. It grants the agent the right to decide on what to do with the principal’s remains after his or her death, as well as donate the organs for educational, scientific, or transplant purposes.

What if I have not appointed someone as an agent to oversee of my health care, you might ask. If nobody has powers of attorney to act on your behalf and you are already unconscious or mentally incapable, the courts will assign someone to make health care decisions for you.

The second type of durable powers of attorney is financial in nature. It is defined as the full legal authority given to another individual to be responsible for all your finance-related affairs, including filing income tax returns and paying the bills. The agent can even sign documents on behalf of the principal.

This agent is allowed to handle all the principal’s finances except the assets owned by the revocable living trust. Examples of assets outside the living trust include pension plans, annuities, and IRAs (individual retirement accounts). These assets are managed by the attorney-in-fact designated by the principal who owns the assets. As with a living trust, durable powers of attorney protect the privacy of the principal as well as prevent delays in financial transactions.

It pays to plan your estate before you become unable to manage things by yourself. On that note, it is important to have a durable power of attorney ready so that you can rest assured that someone you trust will manage all your finances, assets, and health care issues instead of a person appointed by the courts.

Four Main Types of Power of Attorney

If you want to authorize anyone or any organization to properly handle your affairs while you are unable to do so or while you are unavailable, you should get a power of attorney. It is a document that summarizes and proves your agreement to give your appointed person (the agent or attorney-in-fact) the authority to act on your behalf.

There are four main types of power of attorney that you could choose from. These types may be functional and useful depending on your need and requirements. They are: general, special, healthcare, and durable power of attorney.

A general power of attorney is a document that gives your agent a broad authority in handling your affairs. This authority usually includes handling of your banking transactions, purchasing and disposing properties, settling claims, exercising stock rights, entering into deals or contracts, filing tax returns, and buying life insurance. It is usually used to enable your appointed agent the power to handle your important transactions within a specified period when you are practically unable to do them personally.

The special power of attorney provides your agent specific powers. You would decide on those specifics. Unlike the general power of attorney, the special power attorney does not give the agent a broad range of coverage. It only specifies how he/she should act. The document should specify which activities the agent should do. Transactions that are not included in the provisions could not in any way be managed or handled by the person.

The healthcare power of attorney designates the agent as a person who should make proper healthcare decisions for you if you get mentally incompetent or unconscious. If you would not be able to make logical decisions due to health reasons, the agent would be authorized to do so in your behalf. However, take note that the healthcare power of attorney is not the same as a living will, which is a document to express your personal wishes in case you would need life-sustaining procedures.

The durable power of attorney could be a general, healthcare or special power of attorney containing specific durability provisions. In case you suddenly get mentally incapacitated while any of the three kinds of power of attorney is in effect, the durability provision of the document would allow the agent to stay as your attorney-in-fact indefinitely. In the durable power of attorney, you are acknowledging the possibility that you could become mentally or totally incompetent because of any accident or illness. For this power of attorney to take effect there has to be a genuine certification from a doctor to prove the incompetence.

In every power of attorney you would get into, it is always important to make sure you are choosing and agent or an attorney-in-fact who is very trustworthy and reliable. He/She should be able to uphold only your best interest when doing transactions and making decisions on your behalf. You may fully entrust into him/her the authority and power to handle and manage your money or assets.

Understanding The Power Of Attorney

The power of attorney is providing a person or an organization the right to govern or handle your affairs especially if you are unavailable or unable to handle it for yourself. This document could cover simple financial matters like writing a check or even selling property.

When creating the power of attorney, it is for the best to check the laws of the state, since each state has its own regulation on how it should be made. Legal assistance or help from a lawyer is very important to make sure that necessary steps are performed to avoid the document being challenged.

The power is granted to an “attorney-in-fact” or “agent” that would have the authority to decide on different matters. The person who is granting the authority would, of course, identify the scope of the mandate. It could be the specific or the general power of attorney.

There is a specific power of attorney which requires the attorney-in-fact deal with only one particular issue. Specific issues would include bank transactions, debt collection, loan application, managing real estate property or businesses, making financial decisions and handling government financial or other concerns. Usually, this is given in a time when the principal is unavailable for a specific period of time like travel overseas, whether business or personal, and other commitments.

There is also a general power of attorney, which could refer to broader financial and personal matters. For example, it could be buying and selling real estate property, bank transactions with or without U.S. securities involved, getting into contracts, tax returns filing, and handling other matters which deal with benefits coming from the government.

Often, the principal would have two agents, one for the health care and the other for finance. A financial agent’s concert would be centered on the financial condition and issues of the principal. While the health care agent would be overseeing the principal’s medical decisions.

The attorney-in-fact or the agent does not have to be lawyer. H/she could be a relative, a daughter or son and even a trusted friend. When picking out an agent, make sure that the person would stand by the principal’s beliefs since they would act on behalf of the person. Aside from that, the attorney-in-fact would have to keep sufficient and detailed records since the principal should have a copy of transactions made in h/her behalf.

There are situations when the attorney-in-fact could be challenged. The principal should be prepared in case the power of attorney is confronted. It would help to have a video document stating with the principal stating the power of attorney or have several witnesses present to testify that the principal is mentally and psychologically competent when the document was signed.

The power of attorney’s termination is stated in the document. In addition to that, it could also end upon the death of the principal or when the principal, given that h/she is still competent, decided to destroy the document. The principal could also sign or create another document, duly notarized, stating the termination of the document. Often, the power of attorney states an alternate attorney-in-fact, in case the original is compromised or dies. But if no alternate is named, then the power of attorney is terminated.

For the principal, determining the agent or the attorney-in-fact should be done carefully. Since, abuse of the power of attorney could happen which is why it is important for the principal to have complete trust on the agent.

Choosing The Best Agent For Your Power Of Attorney

Ever wondered how your modest properties or finances would be managed, in case something happens to you or you would have to go somewhere? Then think about the power of attorney. The power of attorney is a legal document that would enable you to grant a person or organization control over your financial and business matters.

The person who is signing or creating the power of attorney is called the principal, while the person who would be awarded with authority is called the attorney-in-fact or the agent. Since the power of attorney would provide the agent the control over banking, credit and other financial issues, it is important to be made carefully which is why legal assistance is importance.

There are two kinds of power of attorney, the specific and the general. The specific power of attorney identifies particular transaction when the document would take effect. While, the general power of attorney could cover different personal and business transactions.

When choosing the person who would best represent the interest of the principal, it is important to consider several factors.

• Age. If you are considering your child to be the attorney-in-fact, then you would have to take note of the age. Laws on creating the power of attorney are different on each state. But almost all of the laws agree that no agent should be below 18 or 21 years old.

• Time. When choosing the best agent to represent you, then it may be important to consider the amount of time they can spend on managing financial and legal matters.

• Location. Choosing an agent who does not have to be far from the principal and the property is a better choice.

• Capability. It is important to consider an agent that has the ability to manage the principal’s property and legal matters. The agent is showing problems with managing their own finances, then it may not be a good idea to trust your own finances to them.

• Work experience. It may be important to choose an agent or an attorney-in-fact that has experience or level of expertise in finances or in legal matters.

• Organization and documentation skills. The principal may need the attorney-in-fact to track and properly document the different transactions made whether it is for personal, business or government purposes.

Another thing to consider is determining the spouse as the attorney-in-fact. Most military personnel would provide the power of attorney to their spouses especially if they are away in combat. A close relative could be work as an alternate.

It does not always have to be relative or a family member, some would get a non-relative attorney-in-fact. If the principal is also a bit uncomfortable on assigning a lot of responsibilities on one agent, then h/she could get other co-agents. It could be done as long as the information or the limitation of the capabilities is specified in the power of attorney. Before specifying the name of the agent in the power of attorney, the principal should talk to the agents first and ask them if they are willing to be agents.

There are no organizations, departments or governing agency that would monitor the agent, it would rely on the principal and the principal’s relatives to monitor if the agent is carrying what is stipulated in the power of attorney.