What is a Power of Attorney?

Barring certain disabilities, every adult in the US has the right to sign their own contracts, do their own banking, make their own health decisions, and the like. But what happens if that person is unavailable when a decision needs to be made? Perhaps they are under anesthesia when a medical complication arises and a doctor needs someone to choose Option A or Option B. Or maybe the person is out of the country when a document needs to be signed in person. These kinds of situations, and many others, are where a Power of Attorney document comes in handy.

In a Power of Attorney document, a capable adult can delegate certain authority to another person. This could be as broad as giving a trusted loved one authority to do anything you yourself could do (though always with the responsibility to act as they truly believe you would act and never supplant their personal desires for your wishes). This could also be limited to specific tasks such as granting authority to a third party to sign a real estate contract on your behalf so you don’t have to attend a closing in person.

There are two main types of Power of Attorney documents: one for financial issues (often called a ‘General’ Power of Attorney) and one for health issues (usually aptly named a ‘Health Care’ Power of Attorney).

Many times, both documents are used when a person begins to lose the ability to manage day-to-day affairs as well as they once did. A financial Power of Attorney, for instance, is used to allow a trusted child to help with bills—checking the bank account to ensure things are scheduled to be paid on time, that no one is taking financial advantage of their parent, etc. A health care Power of Attorney is often used to allow a trusted child or other third party to attend medical appointments with an aging person and ensure they are understanding medical instructions, such as which medications to take when, what the purpose is, and potential risks or side effects.

If there is no Power of Attorney document in place when the need for help arises, banks, doctors, and others will often not allow anyone to step in to help. If things get too bad—to the point where the person has lost the ability to legally sign a Power of Attorney—then the only remaining option for intervention is usually to get the court involved through a guardianship or conservatorship proceeding.

For this reason, it is important to get Power of Attorney documents completed well before the need arises, and to monitor them from year to year in case your preferences have changed.

At Gant Law, Power of Attorney documents are one of the most important pieces of your estate plan that we help with. Contact us today for help getting these important documents set up.