Estate Planning: Why have a power of attorney?
Posted on Sep 23, 2014
Estate planning is not just about death planning, it’s for incapacity planning too. In each of our Will packages we include estate planning documents called "ancillary documents" that control what happens if you become incapacitated or disabled and can no longer make decisions for yourself.
Two of the most important ancillary documents are statutory durable power of attorney and durable power of attorney for healthcare. Let’s discuss what these documents are and why it’s so important that you have these documents in place.
What Is a Statutory Durable Power of Attorney?
The statutory durable power of attorney is a document that allows the person or persons you have designated to handle your finances. This document is used if you are incapacitated and are not able to manage your financial affairs yourself. This document can also be used if you need someone to take care of your finances immediately, for example if you are planning to be out of the country for an extended period of time but will need someone to continue taking care of your house or bills.
The person you designate must act in your best financial interest and according to your wishes. Basically, this document answers the question, “If you become incapacitated, who do you want stepping in on your behalf?” Without a power of attorney, the judge is the one who will answer this question--not you.
What Is a Durable Power of Attorney for Healthcare?
A durable power of attorney for healthcare (also known as a Medical POA) is a document that allows the person or persons you have designated to make medical decisions on your behalf. This document can only be used if you are incapacitated and are not able to make your own medical decisions.
- You definitely want to choose this person carefully. The person you choose should be able to do three key things:
- Have a full understanding of your medical situation regarding your health and treatment.
- Always keep your best interests and wishes in mind when making medical decisions pertaining to you.
- Be able to handle the stress of making tough medical decisions.
As you can see, it is so important to have the proper documents in order for your estate. Working with a qualified estate planning attorney is necessary to make sure things are prepared properly to relieve any concerns you might have.