What is a Power of Attorney?
A power of attorney is an estate planning document where one person, the principal, voluntarily authorizes another person, the agent, to act on their behalf. There are two different types of power of attorney documents. One is a financial power of attorney, and the other is a healthcare power of attorney. Many power of attorney agreements don’t take effect until the principal is incapacitated, but it’s also common to see powers of attorney that immediately confer authority to the agent.
Financial Power of Attorney
A financial power of attorney authorizes the agent to manage the principal’s assets. This includes authority to collect income, sell assets, invest funds, and access accounts. A power of attorney is revocable, and the principal can revoke the authority in a power of attorney at any time.
Healthcare Power of Attorney
A healthcare power of attorney designates an agent as a healthcare proxy. Your healthcare proxy has the right to consult with your doctors, access private medical records, and make important medical decisions on your behalf.
How to Create a Power of Attorney
The first step in creating a Power of Attorney is having a consultation with an attorney. An attorney can help you determine what key provisions need to be included in the document. Once the document is drafted, the principal will need to sign in the presence of a notary or two witnesses. Once all the signatures are complete, the power of attorney is typically valid until it is revoked.
Can a Power of Attorney be Changed?
If at any time your situation changes and you need to amend your power of attorney, you can easily revoke the original document and sign a new agreement.
The above information should not be construed as legal advice. No attorney/client relationship is formed upon receipt or delivery of the above information.
