There are several reasons why getting a power of attorney (POA) may be necessary. Whether your health is declining or you plan to travel for an extended period of time, appointing a trusted individual as your power of attorney can make a world of a difference. Essentially, a power of attorney is a document that gives an individual (agent or attorney-in-fact) the legal authority to act on behalf of another person (the principal).
The main purpose of this document is to ensure the principal’s health and finances are taken care of by someone they trust in the event that they become incapacitated and can no longer make decisions for themselves. Most people associate power of attorney documents with elderly dementia patients, but the need for a POA can be as simple as a principal needing an agent to sign a contract on their behalf while they are out of town. So, how do you give someone power of attorney? In this article, we’ll go over the steps you will need to take to appoint a power of attorney, as well as what to consider if someone asks you to be an agent.
But first, let’s go over a few key terms that you will need to when learning how to give someone a Power of Attorney.
Types of Power Of Attorney
Power of attorney is a binding legal document, so it is essential to fully understand your options. Whether an agent is appointed to take care of the principal’s finances, medical decisions, or both, their duties and expectations will be outlined thoroughly in the document. Keep in mind, each POA document is unique to each principal’s needs and desires for their future. Below are the different types of agents.
Springing Power of Attorney
With a springing power of attorney, the agent’s duties do not begin until the principal becomes incapacitated. The document must define what it means for the principal to be determined incapacitated, so there are no discrepancies between the two parties.
The agent’s duties begin as soon as the document is signed and continue in the event that the principal becomes incapacitated. A durable power of attorney can be ordinary/general or limited; the details of the agent’s role and expectations must be outlined in the document. For instance, a durable power of attorney may allow an agent to handle a principal’s finances before and after they are incapacitated. All legal details of the durable power of attorney are covered in the Uniform Durable Power of Attorney Act (UDPA).
Ordinary/General Power of Attorney
The agent’s duties are not exclusive to one area of the principal’s life (i.e. medical, financial, real estate). Rather, this attorney-in-fact is responsible for making decisions across the board for the principal. Typically an ordinary/general power of attorney is appointed to a trusted family member when the principal is experiencing a decline in health.
Special/Limited Power of Attorney
The agent is responsible for a specific area of the principal’s life, usually medical or financial decisions, but not both. In some cases, a limited power of attorney will grant an agent the authority to make a one-time decision, such as signing a contract on behalf of the principal.
How To Give Someone a Power of Attorney
Giving someone a power of attorney is never easy. In many cases, the decision comes with a sick or elderly family member. And while it is difficult to predict what their future will hold, one of the best ways you can protect yourself and your loved ones is to appoint a trusted individual as attorney-in-fact.
A power of attorney may be given to a person through a printed form. Each state has its own preferred form. These forms may also be printed or bought from online legal sites. Review the steps below to learn more about giving someone a power of attorney.
1) Choose the right person(s).
While selecting someone to be your agent sounds rigid, it’s a matter of putting your life in someone else’s hands. Before jumping the gun, have multiple conversations with trusted family members and/or friends. The ones who know you best will be able to help you make this big decision – and, oftentimes, it is revealed to you which of your family members is willing to take on the responsibility themselves.
If you do not have someone in your personal life that you trust to be your attorney-in-fact, you may consider hiring a professional fiduciary. This is simply a paid professional that will carry out your wishes once you are no longer able to. And generally, a paid fiduciary is appointed a limited power of attorney, only handling your financial assets. Once your agent(s) has been decided, you will want them to meet with your attorney so everyone is on the same page.
2) Talk to an attorney.
You may wish to speak to an attorney to familiarize yourself with the process before you make any decisions at all. It is entirely up to you. Either way, your attorney will know all of the minute details that go into a power of attorney document. They will also be able to give you professional advice if you are struggling to make a decision.
3) Choose what kind of power of attorney is best suited to your needs.
Maybe you need one person to make all of your financial decisions, while you have another person in charge of health care choices. Or, maybe you have one person in mind to handle manage all areas of your life.
4) Decide on the details.
Is your agent responsible for a specific task like signing a contract for you, or are they in charge of making all of your financial and medical decisions until death? Fleshing out the details is extremely important so there is no confusion about the agent’s role after the document has been signed.
5) Fill out the power of attorney form.
Once you have determined who will be appointed your agent, as well as what duties they will be responsible for, it is time to create the power of attorney document. You can get this form from the American Bar Association or websites online. It is a simple template, so you do not have to worry about leaving anything out. Include your name, as principal, and the name of the attorney-in-fact. Each form already lays down the tasks to be accomplished by the agent. You only have to check the corresponding boxes of the tasks. You may then select the powers that you will give to your agent.
6) Sign your power of attorney form in front of a notary or witness.
In many states, the form must be filed before the county clerk to validate the document. Be sure to check your state’s requirements and discuss with your attorney before signing the form.
Revoking a Power of Attorney
You must also bear in mind that a power of attorney may be revoked at any time. You may also transform a general power of attorney or a special power of attorney into a “durable” power of attorney. As already explained, it is “durable” since said authority endures even after the death of the principal or even after the principal was declared by competent court to be incapacitated. You can also execute a “springing” power of attorney. This term pertains to an authority that takes effect only after the principal becomes incapacitated.
How to Get Power of Attorney
Maybe you are a caretaker for someone in your life, or you have a sick parent. Either way, you want what is best for them, including the right people to help and support them through this difficult phase in life. If you believe you are the right person for the role, it can be a tricky – but crucial – conversation. And remember: getting power of attorney over someone is entirely their decision, but we have some tips to help you navigate the waters.
1. Discuss the principal’s wants and expectations.
After all, the power of attorney is in place to benefit the principal and make sure their wishes are carried out in the event that they can no longer make decisions for themselves. If you want to get power of attorney over someone, be sure that you fully understand what they want to happen with their finances and health care. It is also a good idea to discuss what your compensation will be as attorney-in-fact, if any.
2. Go with the principal to meet the attorney.
Obtaining guidance from an attorney is one of the most comforting parts of the process. Show the principal that you care and want to give them the best future possible by accompanying them to meetings with the attorney. Ask lots of questions, and loop the principal in on any conversations you have with the attorney outside of your meetings.
3. If there are is another agent, communicate with them so everyone is on the same page.
As mentioned above, a principal may have multiple agents responsible for different areas of their life. If you have been appointed a limited/special power of attorney, be sure to speak with the other agent(s) about each of your roles and how you will work together for the betterment of the principal.
4. Keep record of everything.
As an attorney-in-fact, you will likely be faced with making difficult decisions. It is essential that you maintain record of every action you take on behalf of the principal. This can be as small as keeping receipts for food you buy the principal and as significant as making a medical decision for them. When making medical or financial decisions for the principal, you also must have the power of attorney document on hand to show banks, physicians, etc.
Liability as a Power of Attorney
Obtaining Power of Attorney can feel like a lot of pressure. After all, you are responsible for the financial and/or medical decisions on behalf of another person. While this role should not be taken lightly, you do not need to be concerned about being liable for the principal’s financial outcomes. For instance, many agents worry about the financial debt that builds up from nursing home fees and medical care. However, you are not responsible for paying off any debt or expenses incurred by the principal. The only way you could be held liable is if you act negligently and not in the best interest of the principal.
Keep in mind, being assigned power of attorney is not the right choice for everyone. Ensure that you have the capacity to handle the responsibility and the desire to care for the principal. For example, consider if the principal has a medical emergency; you may need to take time off work, travel to meet them, or make life-altering decisions. If you are not comfortable or willing to do so, it is best not to agree to be an agent. Elder attorney John Ross stated, “Tell that person, ‘I’m concerned about you enough to tell you that I’m not the right person.'”
What Happens if You Don’t Have a Power of Attorney in Place?
If someone is concerned about their medical and financial future, assigning a Power of Attorney before things get worse is one of the best things you can do to ensure you and your belongings are taken care of. As previously stated, a principal can only grant someone power of attorney if the principal is legally competent. So, what happens if someone is in a sudden accident, or has dementia and is deemed incapacitated before a power of attorney has been assigned? While the principal will not be able to grant someone POA, there are other options for loved ones to consider.
One of the options is adult guardianship (conservatorship), which is similar to a power of attorney. In this case, a judge would make the final decision on who should be the guardian, not the principal (if an adult is declared mentally incompetent, they are no longer able to make legal decisions0. The process of determining an adult guardianship can be expensive, as well as stressful for the family because it is often tied to an unexpected illness or decline in health of the principal.
To learn more about POA, take a look at 5 Things to Know About a Medical Power of Attorney.