A power of attorney can be an invaluable tool for estate planning. In Wisconsin, the two essential power of attorney roles are health care POAs and financial POAs.
As the Wisconsin Department of Health Services explains, designating a POA gives an agent the authority to act on your behalf in the case that you become incapacitated. This creates a legal relationship that continues until the agent resigns or the principal terminates or revokes the agreement.
Many principals in Wisconsin designate one person to handle their finances and another to make health care decisions. While this can be a great arrangement in many cases, it can also present issues.
Using one agent for health care and finances
You have the option to designate one power of attorney to handle both your finances and your health care decisions. This can simplify situations when your agent needs to pay for medical expenses, for example, and it can help keep your estate transparent to those making decisions on your behalf. It also offers the benefit of having one person balance your health care and financial needs.
One concern for a single power of attorney is the fact that the position can be very demanding to handle. It may be difficult to find someone with the willingness and ability to take on both roles. Similarly, you may have someone you trust to make financial decisions who does not share your values for health care decisions.
More importantly, however, your POA needs to be someone trustworthy and capable. Giving someone complete control over your estate and health care can create a situation where his or her actions go unchecked. If you do decide to use one POA, be certain that the person is someone you trust to be both honest and wise.
Using more than one agent
Using two or more powers of attorney can be a wonderful way to break up authority and keep agents making decisions in their area of expertise. Causing two or more agents to make decisions together can be an effective tool for achieving more reasonable outcomes.
However, be careful to designate agents who work well together. It is possible, for example, to encounter a situation where your health care agent makes decisions that your financial agent refuses to pay for. This can result in inefficiency and sometimes even outright conflict.
If you do decide to use more than one POA, limit the number of agents and be clear in your agreement about each one’s authority. This can help avoid a situation where agents dispute who has the authority to make a certain decision.