An estate plan includes much more than a will or trust. In fact, to be set up for success and to protect the interests of loved ones, an estate plan needs to include much more.
It includes a financial power of attorney and healthcare directive (or living will) at minimum. The power of attorney itself is a document that is often overlooked but is of vital importance.
What is Power of Attorney?
Power of attorney is a document that makes an appointment or designation, naming one or more individuals who can make legal and financial decisions on someone’s behalf in the event they are unable to speak for themselves.
This could be in the event they are suddenly incapacitated from an accident or illness or even something as simple as someone who is out of the country and needs someone to pay their bills and sign checks on their behalf.
A power of attorney is only valid, however, during the individual’s lifetime. Once someone passes away, the power to make legal or financial decisions on your behalf goes to their personal representative or executor.
A healthcare power of attorney agent is an individual who is appointed to make medical decisions on the individual’s behalf. Your power of attorney and healthcare representative can be the same person or they can be two different individuals. One can also appoint a successor agent or multiple successors.
Choosing the Right Person
When determining who an ideal power of attorney should be, consider who in your life you trust with important financial, tough decisions. You should find someone who is responsible with money and someone who does not make decisions influenced by stress or emotions.
This individual should also be someone who is not easily influenced by others. Money can bring out the worst in people, including relatives. Your power of attorney is charged with the duty to look out for your best interests and should do so even if others disagree with his or her decisions. This duty is otherwise known as a fiduciary duty.
Even if your power of attorney is one of your beneficiaries under your estate plan, he or she is to follow your directions and handle your money and legal decisions in your best interests first and foremost. It does help if this individual is local.
Family does not always live locally, but whoever you choose, should be reachable if at all possible. If a quick decision needs to be made, it is important that this person can be contacted and can make whatever actions are needed.
Why Is It Important?
“But nothing is going to happen to me in the near future. I am not that old!” Yes, that may very well be true, but reaching old age is not a prerequisite for preparing a power of attorney. Consider this situation: you are going about your day when the unthinkable happens.
You suffer from a stroke, and suddenly you no longer have the ability to speak, communicate or even process normal thoughts. It does not matter how old you are. Even young individuals can suffer from a stroke. What happens to you? You need someone who can make decisions for you.
If you need to go under long term care as you recover, you will need someone who can get you in there but also maintain your lifestyle, your home, pay your bills, etc. while you are recovering.
Depending on how long you are incapacitated, if you do not have a power of attorney set up, your loved ones will have to pursue this authority through the court system, whether that be through a conservatorship or guardianship. That process can be lengthy, complicated and expensive.
Why put your loved ones through this ordeal when you can easily avoid it all together with the creation of a power of attorney? No one wants to think that you need this document or that you will face the above situation or something similar.
However, preparing yourself for any situation is the best thing you can do. It is a simple process and is well worth the small investment.
Contact Brian M. Douglas, LLC
today If you are not sure you need an attorney, you can always come in for a consultation to discuss your situation. Call us today at (770) 933-9009 or contact us online to schedule your consultation.
