ESTATE PLANNING NEWS & ARTICLES
What is a Power of Attorney and Why It’s Important, Especially Now
With the COVID virus starting to make a second surge across the United States, including here in Arizona, one of the most common questions I get from people both online and in person is relating to Medical and Financial Powers of Attorney. Usually it is from folks with an aging or ill parent or parents or parents of teens turning 18 and moving away from home (usually either traveling or away at school). Most haven’t heard of these documents or don’t know how to start the process and reach out for assistance.
I am always happy to explain how with powers of attorney in place they can take better care of their folks or teens. It is usually a HUGE relief when it comes to worry and to the amount of time they have to dedicate to resolve medical or financial issues that arise practically daily.
Powers of Attorney, Defined
A power of attorney is a written document that gives an individual (called an agent here in Arizona) power to act on your behalf. The scope of that power may be specific to a particular activity (e.g. closing the sale of your home) or general in its application to a whole variety of legal and financial matters. The document can also specify whether the powers will take effect immediately, or upon the occurrence of an event. Powers of attorney generally terminate upon the death of the person granting the power. Also, unless the power is “durable,” it generally terminates if the person granting the power becomes incapacitated. Both financial and medical powers of attorney work this way, yet we use two separate documents.
Financial Power of Attorney
This document allows the agent you choose to step in for you to handle your financial decisions. This includes simple things like paying bills to managing retirement accounts, to large undertakings like operating your small business on your behalf. Your agent doesn’t need to be an attorney, an accountant or other expert, just someone you trust who has a good common sense about these types of choices and is very dependable. Many people elect their spouse or older children to assume this role for them, but you can even hire firms to do this for you. Learn more about Financial Powers of Attorney HERE.
Medical Power of Attorney + Living Will
A Healthcare Power of Attorney elects a trusted agent to direct and make medical decisions for you when you are unable to do so yourself. Again, this person should be someone you trust and can depend on to carry out your specific wishes, especially if others disagree.
In Arizona, we also strongly recommend a second document called a Living Will, which details specifically the types of medical treatment you would/would not like in certain situations. The decisions detailed in this document are the ones that are often dramatized on TV medical shows when a character is portrayed in a prolonged coma or requests not to be resuscitated (a DNR). Sadly these scenarios happen in real life all too often when people don’t have these documents in place which is stressful during an already difficult time. Terry Schiavo is one of the most famous examples. Learn more about healthcare docs HERE.
This is a very basic overview of these very important, detailed documents. There are of course other choices to be made next, such as Organ Donation. I highly suggest that everyone invest time in creating powers of attorney, a will, trust and real estate deeds in place sooner rather than later to be fully prepared should an illness or incident occur. To learn more about Powers of Attorney, please contact Seiter Law directly.