Power of Attorney
The idea of not being able to make or communicate decisions as the result of an accident or health crisis sounds terrifying. While thinking about such a situation may be unpleasant and uncomfortable, putting a plan in place for what you want related to your health care, as well as who you want to make decisions on your behalf, is important. As part of your estate plan, our lawyers strongly recommend including a power of attorney. To learn more about powers of attorney and the benefit of including a power of attorney as part of your estate plan, reach out to our skilled estate planning lawyers at Garmo & Garmo, Attorneys at Law, LLP today.
What Is a Power of Attorney?
As explained by the State of California, a power of attorney is a legal document that gives another person the right to make certain decisions or perform certain actions on your behalf. Powers of attorney are used for a variety of reasons; in regards to an estate plan and planning for your future, powers of attorney are used to choose who you want to make decisions regarding your finances and health care when you are no longer able to make or communicate those decisions on your own.
Types of Powers of Attorney
There are multiple types of powers of attorney. For the purposes of estate planning, there are two types that are most commonly used:
- Health care powers of attorney. A health care power of attorney gives another person the authority to make decisions about your health care, including end of life and palliative care, life-extending measures, certain medications or treatments, your doctor, where care will be received, and more. This is a person who is appointed by you, usually through the creation of a living will/advance directive. A health care power of attorney, also called a health care agent, cannot be your doctor.
- Financial powers of attorney. In addition to health care powers of attorney, there are also financial powers of attorney. A financial power of attorney is a financial document that authorizes another person to make financial decisions on your behalf. For example, if you are a business owner and there is a pressing business decision that needs to be made, the person you have designated as your financial power of attorney would have the authority to make this decision. Powers of attorney can be used to authorize another person to perform a wide range of actions and make a breadth of different decisions. You can also limit the authority of the person you give power of attorney to make certain decisions.
Who Should You Choose as Your Power of Attorney?
Who you select to serve as your power of attorney and to make health care decisions, financial decisions, or both on your behalf is a major choice. At the very least, you should choose someone whom you trust to follow your wishes and act wisely.
For your financial power of attorney, you may want to consider choosing someone who has experience in finance, accounting, or business, or someone you would trust to consult these professionals when appropriate. For health care powers of attorney, the person selected is usually a trusted family member, such as a spouse or child. Sometimes, a person who is given power of attorney is a close friend.
When you choose a power of attorney, it’s very important to have a conversation with the chosen person about their responsibilities and your wishes before you appoint them as your power of attorney. Not only do you want to get their consent first, but you also want to make sure that they understand your wishes and are committed to adhering to them.
Note that powers of attorney are often accompanied by a variety of other estate planning documents that can help to guide decisions and add clarity to confusing situations. For example, your will may have details about what you want to happen to your business, and your advance health care directive will contain information about your health care preferences.
What Are the Responsibilities of a Financial Power of Attorney?
The role and liberties of a financial power of attorney are typically outlined in the documentation filed to establish it. Every POA should consciously read through the documentation for attaining a complete understanding of the property decisions, accounts, and other assets that are managed.
It’s wise for the power of attorney not to go beyond the boundary of the responsibilities described within the legal documents for paying off any debts or fulfilling a need.
For instance, consider a situation where the power of attorney is required to handle a specific debt. For this exact purpose, they are provided access to a specific account from which they can retrieve funds for paying off the debt.
The POA should not use funds from other accounts or sell off any assets owned by the principal if the debt exceeds the available amount. Instead, the power of attorney should attempt to seek permission from the person they are representing or use other means to satisfy the debt.
The Advantages of Creating a Power of Attorney
Creating a power of attorney may seem unnecessary – it can be hard to imagine that a time will come when you will be unable to make decisions on your own, or articulate those decisions to your doctor, financial professionals, or others. However, it’s impossible to predict the future, and incapacitating injuries and illnesses become more likely with age.
When you have a power of attorney or powers of attorney in place, you’ll have comfort and peace of mind in knowing that a trusted confidant will be making decisions on your behalf should such a situation become necessary. This can also be comforting to your family members, who may otherwise experience conflict and confusion about what’s best for you.
Do You Need an Attorney to Create a Power of Attorney?
In California, you are not legally required to consult with a lawyer when you create a durable power of attorney; however, working with an estate planning lawyer is recommended as doing so can simplify the process. Your attorney can help you by:
- Understanding the types of powers of attorney and which types are most appropriate for your situation;
- Drafting powers of attorneys legal forms that specifically address issues that are unique to you;
- Amending any existing powers of attorney;
- Helping you to understand what you should look for in the person you choose to serve as your power of attorney; and
- Ensuring that your powers of attorney are legally enforceable and valid.
Reach Out to Our Experienced California Estate Planning Lawyers Today
If you have questions about estate planning documents and powers of attorneys, our California lawyers at the law office of Garmo & Garmo, Attorneys at Law, LLP can help. You can reach out to our lawyers by phone at 619-441-2500 today to get started. You are also welcome to stop into our law office at your convenience or use the contact form on our website to send us a message. We can assist you with a variety of estate planning documents.