If you have ever seen the letters “POA,” you have probably wondered, “What is a power of attorney?” In essence, this is a legal document that enables another person to act on your behalf in the event that you become mentally or physically incapacitated. It is a binding legal document that gives the person you appoint the power to make decisions for you, including medical, financial and other important decisions. You can specify what your power of attorney is and is not able to handle. Here’s what you need to know to implement your own power of attorney.
Uses for Power of Attorney
There are many categories of people who will have use for a POA arrangement. The most common is the elderly. When you reach the later stages of your life, the possibility of contracting a debilitating illness or suffering from memory issues becomes increasingly more likely. When it gets to the point where you can no longer make decisions for yourself, you’ll want to have someone you trust in place to handle those decisions for you.
Even if you haven’t yet reached your golden years, you may still wish to have a power of attorney for medical reasons. For example, if you are planning to undergo major surgery, you may wish to institute a POA in case of any complications during the procedure or recovery process. This would likely be a temporary arrangement until you are well again.
If you travel frequently, you may institute a power of attorney to handle your affairs back home. This would be especially useful if you are traveling to areas that don’t have reliable phone or internet connections, making it difficult for you to tend to important matters. As in the previous instance, this would probably only be temporary. You would retake control when you return home.
Another common use of POA arrangements is for people who own their own businesses. Even if you don’t anticipate being away from your business for an extended period, you might want to have a POA in place in case of emergency. You never know when you might fall ill or be in an accident. A POA will ensure your business continues to run according to your directives until you are able to return.
There are plenty of other scenarios that may warrant a POA. Don’t be shy about talking to an attorney to learn more about the process and how it works.
Types of Power of Attorney
Just as there are many uses for a POA arrangement, there are many different types as well. Each gives your appointed person a different amount of control, according to your wishes.
General Power of Attorney
This is the broadest of all the POA options. It gives your chosen person or entity the greatest level of control. Your POA can handle a variety of tasks for you, including:
- Managing your finances
- Purchasing insurance, including life insurance
- Operating your business
- Settling legal claims
- Hiring additional help
- And more
This type of POA agreement is often included as part of the estate planning process, enabling you to appoint someone to handle any financial issues that arrive after your death. This type of arrangement is also common for travelers and those who are concerned about their ongoing physical or mental health. Under this POA type, your chosen agent basically acts for you as if you were there yourself.
Special Power of Attorney
In a special power of attorney arrangement, you can pick and choose the powers you wish to impart to your agent. In this case, you specify exactly what your agent is and is not allowed to do. For example, if you will be traveling, you may allow them to sell an old car for you while you are away but not make decisions regarding your children’s education. You may also choose to allow them to manage your real estate investments but not your charitable giving. In the POA document, you will have the chance to delineate the specific capabilities you want your agent to have in your absence and can also specify areas in which they are to have no control.
Health Care Power of Attorney
This is one of the more well-known uses of power of attorney, allowing your agent to make medical decisions for you. Of course, this person can only take action if you are incapacitated. This can include if you are:
- In a coma
- Mentally incompetent
- On life support
- Or otherwise incapable of communicating your wishes to doctors
Although similar, this is not the same as a living will. In a living will, you specify your wishes for your medical care in a variety of situations. In a healthcare POA arrangement, you grant the power to your agent to make medical decisions for you. If you have specific requests regarding your ongoing care, you can combine a healthcare POA with a living will, letting your agent know exactly what you expect of them, including your wishes with regards to being kept alive on life support. If you do have a living will, this document will override the POA agreement, meaning that your agent is legally bound to follow your specific instructions.
Durable Power of Attorney
This is an additional provision that you can add on to any of the above types of POA agreements. In many cases, POA documents are only temporary, enabling your agent to act on your behalf only in specific conditions. With a durability provision, the agreement is safeguarded against any possible complications. This keeps your power of attorney in effect under any circumstances that you were not able to foresee.
Choosing Your Power of Attorney
Choosing the person you name as your agent is just as important as choosing what powers that person will have. Because this person will be acting on your behalf, it is crucial that you choose someone you can trust to look out for your best interests when you are unable to do so yourself. You also want to ensure that this person will respect your wishes and won’t abuse the power you have given them.
In most cases, people name a relative or close friend to act as their power of attorney. However, you can also name an organization, your attorney or any other entity you prefer. You also have the option of appointing multiple agents. When you have more than one agent, you can specify whether they can each act independently or need approval from all agents to make final decisions.
Requiring multiple agents to be in agreement can help to prevent any one of them from abusing their power or going against your wishes. The drawback, though, is that your agents may disagree from time to time, creating delays in decision-making. This could present a problem if any required decisions are time-sensitive, like in medical scenarios or the signing of important documents.
Even if you only appoint one agent, it is a good idea to have a successor in place in case your preferred agent is unable to assume the role. This successor would only come into play if the primary agent is unavailable or incapacitated. Having this backup plan in place will ensure that your wishes are still carried out as you had hoped.
Your Agent’s Responsibilities
When acting as your POA, your agent should keep detailed records of everything they do on your behalf. This includes things like recording all financial transactions, documenting medical tests and procedures, and providing you with updates if you are able to receive them. If you will not be able to review these updates, you can appoint a third party to evaluate them on your behalf.
Your agent will be held legally responsible for any decisions they make while acting as your agent. This means that they can be prosecuted for any intentional misconduct. It is important to note, though, that the provisions of POA agreements protect your agent against legal action for anything that they did wrong unknowingly. Many people are reluctant to take on this much responsibility, so this protection can provide the peace of mind they need to agree to be your POA.
As unfortunate as it is to think about, there are those out there who take advantage of their positions as POAs. If you or anyone else you trust suspects that your power of attorney is going against your wishes or engaging in wrongdoing on your behalf, you can report them to law enforcement personnel. In scenarios like this, it is wise to consult an attorney as well to learn more about the next steps you should take.
Verifying Your Power of Attorney
When you first create a POA document, you must be mentally competent. This ensures that you truly wish for a particular person to handle your affairs for you and aren’t being forced into the agreement against your will. To ensure that there are no complications in enacting your POA, you can get a mental competency verification from your doctor to include with the document.
Once you have completed the document, you will need to sign and notarize it for additional verification. It is also a good idea to create several certified copies of the document to give to banks, attorneys, doctors and other businesses. Many entities will not allow your agent to act on your behalf until they have received a certified copy of the POA agreement.
Competency can come into question when enacting the POA agreement. In order for your POA to take over, a doctor must certify that you are mentally incompetent unless you have specified other provisions like being out of the country. You can choose a particular doctor to provide this certification or you can request that at least two doctors corroborate the diagnosis.
In extreme cases, a court may need to step in to determine your competency. In this scenario, the decision of the court overrides any other recommendations that have been made. While you don’t need an attorney to execute your POA, it is a good idea to consult one in the process of creating the document to ensure you are adequately protected and that the document meets all necessary legal requirements.
Revoking Your Power of Attorney
You have the power to revoke your power of attorney whenever you like, assuming that you are still mentally competent. To cancel the arrangement, you must notify your agent in writing. You should also collect all certified copies of the document so that you can destroy them. You’ll need to notify any banks, medical professionals, businesses and other entities that the document is no longer in effect so they can destroy their copies as well. You’ll also need to tell your County Clerk’s office that the document has been revoked.
Ongoing Care in Your Retirement
If you have reached retirement age, it is smart to set up a power of attorney agreement to protect your wishes in case you fall ill or lose your mental faculties. However, legal protection isn’t the only thing you’ll need in this case. You’ll also need qualified care.
Here at San Diego Compassionate Caregivers, we provide a variety of in-home care types for the elderly. For those who are still relatively independent, we can provide companionship and socialization. For those who need a bit more assistance, we can help with daily activities, including dressing and grooming, getting to appointments, preparing meals, doing light housework and more. We can even assist those with memory loss issues, like dementia and Alzheimer’s.
We welcome you to get in touch with us to learn more about our various care options in San Diego and how we can help you make the most of your golden years while staying in your own home. Our caregivers will be happy to answer all of your questions to give you a better sense of what we have to offer. Call us today to get started.