General Power of Attorney Overview
A power of attorney (POA) is a legal document which gives someone else the right to manage your affairs as if they were you. Once the power of attorney is printed, signed, and notarized, your agent, or the person you name to take care of your affairs has full rights and access to your accounts. Banks, doctors, hospitals, and other third parties are legally obligated to honor the power of attorney until they receive written notice from you that the power of attorney has ended.
There are many types of powers of attorney:
Under traditional law, powers of attorney were no longer valid when the person who wrote the power of attorney, called the principal, became mentally incapable of making their own decisions. This is exactly the opposite of what most people wanted, so the durable power of attorney was created. A durable power of attorney lasts even when the principal becomes incapacitated. It can begin either when it is signed, or in the case of a springing durable power of attorney, when the principal loses the ability to make decisions on her own. Durable powers of attorney can be limited or general. The principal can end a durable power of attorney by including an expiration date in the power of attorney, or by sending written notification to the agent and any third parties with whom the agent dealt on your behalf.
Healthcare Power of Attorney
A healthcare power of attorney lets your agent make medical decisions on your behalf. While you can make some decisions through a living will, otherwise known as an advanced healthcare directive, it is very difficult to anticipate every possible medical issue. A healthcare power of attorney will be able to fill these crucial gaps in your plans.
Financial Power of Attorney
A financial power of attorney allows the agent to make financial decisions on your behalf. It can be limited only to a specific area of finances, such as managing retirement savings, or general enough to cover all of the principal’s finances.
Childcare Power of Attorney
The childcare power of attorney will allow the agents to enroll your children in school and make basic medical decisions on behalf of your children. If the agent is not a relative, the agent can only make school related medical decisions, such as immunizations. Since childcare powers of attorney are so easy to set up compared to a formal guardianship, childcare powers of attorney award fewer rights than a formal guardianship. A guardianship continues indefinitely, while a power of attorney only lasts for a short time. Since a childcare power of attorney is not authorized by the court, some institutions may not honor it. However, a childcare power of attorney will work in an emergency or for a very short period of time.
A general power of attorney grants the agent broad authority to transact business on behalf of the principal. If you intend to include healthcare or childcare authority in the general power of attorney, that authority must be specifically written into the document.