Perhaps you have not yet looked into all the tools available to you in an estate plan, but you want to know more about the basics.
What exactly are powers of attorney and when should you put them in place?
The power of attorney for healthcare enables the person you appoint as your agent to make medical decisions on your behalf if you cannot do so yourself. The POA for finances enables your agent to make financial and legal decisions for you.
Durable versus springing
A durable POA becomes effective as soon as you sign it. However, although you name an agent in advance, a springing POA will not go into effect until such time as you become incapacitated. If you choose to create this type of POA, you must do so with care since you must specify the kind of event that will activate the springing power and therefore the power of your agent to assume his or her duties on your behalf.
Your agent selection
Many people choose a family member to serve as their agent in a POA, but some go with a trusted friend. Once you select your agent, make sure you discuss what is involved and what his or her responsibilities will be.
When to act
If you are a senior, having both a POA for healthcare and a POA for finances will give you peace of mind. Remember that these powers must be established while you are still mentally competent. If you are younger, however, it is still a good idea to create powers of attorney. By doing so, you can save your family the possibility of having to establish a guardianship if an accident or illness causes you to become incapacitated.