A “power of attorney” is a legal granting of rights, including the right to direct financial affairs, make legal decisions, and even make medical decisions, to another person. It is one of the most important decisions a person can make while creating their estate plan. The person granted power of attorney (POA) is referred to as the agent or attorney-in-fact, and the person who grants power of attorney is the principal.
Once granted power of attorney, the agent may make decisions regarding the resources of the principal, including decisions regarding bank transactions, real estate, stock trading, and paying bills. In some cases, the power of attorney document may say that the agent need not consult or get permission from the principal for any financial decision. The agent may also make medical decisions for the principal if those rights were granted in the power of attorney document.
Why would anybody need to appoint a power of attorney? The principal may be ill or traveling and unable to adjust or even monitor important financial information. Military personnel will get a power of attorney if they are sent overseas. A financial POA can also be of limited duration as specified in the power of attorney document.
What the POA Document Should Include
The POA document spells out precisely what decisions the agent can make on the principal’s behalf and any conditions, such as how long the POA will last and when it will begin. It is signed by the principal and the agent in front of a notary public.
People who are incapacitated due to mental illness need a power of attorney so the agent can work with doctors and other providers when making medical decisions. However, it is important to draft the POA when you are mentally competent. If you draft the POA when not fully competent, someone could petition a court-appointed committee to determine whether you can make your own decisions. If the committee agrees that you weren’t competent when the POA was drafted, they could appoint someone to be your guardian without any input from you or your family. Once a guardian is appointed, they can make all your decisions, medical and financial, for you.
In Texas, the POA can remain in effect indefinitely for financial decisions and is called a durable power of attorney. If you need a POA for medical decisions, you can draft a durable power of attorney for healthcare. Your healthcare agent will work with healthcare providers to guide your medical care.
Get the Best POA Agent You Can
It is obvious that you should choose an honest and trustworthy person for your power of attorney agent. You are going to rely on them for difficult decisions, both financial and medical, and you need a person who can make those decisions in a timely and reasonable manner. Your agent should be able to handle money well, too.
Working with an experienced attorney to draft and amend, if need be, your power of attorney is very important. Having a lawyer who understands your needs and goals will keep your estate planning and medical care robust.
Contact Us Today
Attorney Stephanie Hon of The Law Offices of Stephanie Hon is an experienced estate planner and can guide you through the process of planning and drafting the power of attorney document you need. Call us today at 512-888-9378 to discuss your estate planning needs.