Choosing a power of attorney (POA) is an important decision that can impact your future well-being and financial security. This person will make decisions on your behalf if you become unable to do so. Selecting the right individual requires careful thought and planning.
Understand the types of power of attorney
There are different types of POA, and each serves a specific purpose. A general POA grants broad authority over financial and legal matters but becomes invalid if you lose mental capacity. A durable POA remains in effect even if you become incapacitated. A healthcare POA gives someone the authority to make medical decisions for you. Understanding these differences helps you choose the right option for your needs.
Choose someone trustworthy and responsible
Your POA should be a person you trust completely. They will have control over important financial, medical, or legal matters. Look for someone responsible, organized, and capable of making decisions under pressure. Many people choose a spouse, adult child, or close friend, but it should be someone who understands your values and wishes.
Consider their financial and legal knowledge
A POA does not need to be an attorney or financial professional, but they should have a basic understanding of financial and legal matters. If they will be handling complex finances, experience in budgeting, investments, and bill payments is beneficial. For healthcare decisions, they should be comfortable discussing medical issues with doctors and advocating for your wishes.
Discuss your wishes in advance
Before granting POA, talk with the person about your expectations. Explain how you want your financial and healthcare decisions handled. Providing clear instructions can help prevent confusion or disagreements later. If necessary, consult with professionals to ensure your POA documents align with state laws.
Choosing a POA is a major step in planning for the future. Selecting the right person ensures that your wishes are followed and your affairs are managed properly.