There are sometimes circumstances that arise in life during which people is, unfortunately, unable to make important decisions for themselves. It is during these times that a document called a “power of attorney” could come into play. This document allows a designated agent to legally make decisions for another person. While many people may have heard of a power of attorney, most do not realize that there are several different types, each serving its own specific purpose.
The first, and likely the most utilized version, is the “durable” power of attorney. It comes into play when a “principal,” who is the person giving the power, becomes incapacitated in some way and is no longer deemed fit to make their own decisions. This power is irrevocable. It will remain in place until a principal dies. Second, a durable power of attorney may also be drafted with “springing” powers. It is the exact same as a standard durable POA, except that it is not always in force. This power “springs” into place when a catastrophic event happens that left the principal incapacitated.
Third, a medical power of attorney allows a person to make medical decisions on behalf of another person. In medical settings, such as hospitals and physician offices, we hear this form referred to as an “advanced directive.” Finally, fourth, a financial power of attorney allows a person to make financial decisions for another person, including managing bank accounts and stocks.
It is important to decide which power of attorney document is most likely to be needed in your specific circumstances. We never know when a catastrophic event may arise. Having the proper power of attorney in place can give peace of mind in knowing that a trusted party is acting in your best interests while you are unable to make decisions for yourself.