A powers of attorney document is used when an individual wants to appoint another person to be in charge of their financial or medical decisions in case they experience a drastic lifestyle change and cannot make sound decisions. This often requires two separate roles and documents – financial power of attorney and medical power of attorney (advanced healthcare directive). Allow us to explain more about this important document:
1. Your rights are not relinquished by appointing a power of attorney.
The powers of attorney document will be detailed and specific. It will list out exactly what the maker of the document, also referred to as the principal, has given authority for the power of attorney to do. The authorized individual, also known as the agent, does not get unrestrained access to make decisions for the principal. He or she can only act within accordance to the powers of attorney document.
2. The agent no longer has powers of attorney once the principal is deceased.
The powers of attorney document is only applicable when the principal is alive. Once the principal has passed away, the authority that was given to the agent no longer applies. Other matters will have to be taken care of, such as estate affairs and financial management, but those are addressed in a living trust which must be created while the principal is alive.
3. The powers of attorney document can eliminate the need for guardianship proceedings.
If a powers of attorney document is not signed before the individual is incapacitated, time-consuming and stressful guardianship proceedings will have to be pursued. A detailed and professional powers of attorney document written by an experienced lawyer can eliminate the need for these proceedings and help your family focus on helping the principal instead of on legal matters.
4. The principal must be competent upon signing the document.
Although sometimes difficult to determine exactly when someone will become incapacitated, it’s vital that the principal is competent upon signing the powers of attorney document. If the principal is already incapacitated, a powers of attorney document cannot be signed. The individual must know what he or she is signing and be able to communicate his or her wishes.