Whether you are taking steps to execute an estate plan for yourself or are assisting an aging parent as he or she begins to get affairs in order, there are certain matters of importance you might want to address. Most people sign a last will and testament. However, you may also want to consider signing a power of attorney.
Signing a power of attorney can be helpful in several ways. Of course, the decision-making authority associated with such documents depends on which type of power of attorney you sign. For instance, your parent might wish to grant you power of attorney over his or her finances.
An advanced health directive often includes a power of attorney
If your estate plan or your parent’s plan includes an advance health care directive, there may also be someone who is appointed to make medical decisions if the estate owner becomes incapacitated. This is often referred to as a medical power of attorney. It is not uncommon for a specific individual to have a financial and medical power of attorney.
Make sure you understand the implications
Whether you are asking someone to make decisions on your behalf or are being asked to carry out such duties for your loved one, it is important to clearly understand state laws and all responsibilities that come with accepting the position. If you are executing your own estate plan, you will want to make sure that the person you choose to have power of attorney is someone you trust and someone you know to be reliable.
It is never a good idea to sign a power of attorney without first making sure the person you are appointing is willing to fulfill the position. Also, if for some reason you do not feel capable or willing to carry out a power of attorney for your parent, it is imperative that you let him or her know this before he or she signs the legal documents.
When does a power of attorney take effect?
A durable power of attorney is effective upon signing. On the other hand, if you only want a power of attorney to take effect under certain conditions, such as if you become incapacitated, you must incorporate these instructions into the legal document.
The term ‘incapacitated’ is ambiguous, so it is also important to specify in writing what you mean by that when signing a power of attorney. As long as the person who has executed an estate plan is of sound mind, he or she can change or update the plan as needed. If legal complications arise regarding documents in an estate plan, in particular, a power of attorney, it is best to reach out for support from someone with experience in the estate planning process.
