If an accident or illness left you incapacitated, how would you manage your medical and financial needs?
If you add powers of attorney (POAs) to your estate planning tools, you and your family can enjoy peace of mind in the years ahead.
The medical POA
Also known as the POA for healthcare, the medical power of attorney provides the person you name with the legal ability to make healthcare decisions on your behalf. At the time you create the POA, you should discuss options with your agent. If you become incapacitated, he or she can make a wide range of decisions for you ranging from hospitalization and surgery to long-term care.
The financial POA
You could appoint the agent handling your medical POA or choose a different person to make legal and financial decisions on your behalf if you can no longer do so. For example, your agent can pay your bills, file your taxes, make investment decisions and handle real estate transactions. A POA for finances is also helpful for a principal who simply needs assistance with day-to-day responsibilities such as balancing the checkbook.
A look ahead
Aging brings the potential for memory issues and some level of dementia. A doctor will not usually make a diagnosis of dementia until the patient has significant cognitive impairment. It is therefore advisable to establish medical and financial POAs sooner rather than later. A principal must be mentally competent when signing powers of attorney and appointing agents or the documents will not stand up in court. Creating your powers of attorney early on is a wise decision that will provide the peace of mind you deserve.