Planning for the unthinkable is a crucial part of keeping your family financially stable during a turbulent time. However, your estate plan should also include documents that help you in times of need.
A power of attorney is the appointment of a person to speak for you when you cannot. The times when a power of attorney becomes active vary depending on the type of authority you wish to give. Find out how these documents help you and your family move forward during a difficult time.
A durable medical power of attorney
Your estate plan may include a living will that sets out your expectations for end-of-life care. However, this does not grant the medical facility permission to act. For that, you should have a medical power of attorney. This person is ultimately responsible for giving the hospital permission to treat you. Suppose the living will is not applicable because your condition is not terminal. In that case, a medical power of attorney allows someone you trust to make the appropriate medical decisions on your behalf until you recover.
The financial power of attorney
You may become incapacitated and unable to make sound decisions. When this happens, you will need someone to take care of your finances to ensure your bills get paid. A financial power of attorney grants your chosen representative to act as you would when handling your finances. This means he or she can:
- Access your bank accounts to pay bills
- Sell assets to pay for your continued care
- Sign legal contracts for the sale and purchase of goods and services for your benefit
Your financial power of attorney remains intact until an authority finds you capable of handling your money again.
When you set out to protect your family and yourself, you should create one or more power of attorney designations.