Power of attorney is an essential document which is included when planning an estate. It is a legal document in which you name an agent or a person who will be making decisions on your behalf in an event of you becoming incapacitated or deceased. These decisions could range from personal or health decisions to financial decisions.
In this instance you are referred to as the “principal” while the person or agent you appoint is referred to as “attorney-in-fact”. The attorney-in-fact is bound by law to make decisions in your best interests. And the area under his authority is decided by the principal.
The issue of when a POA should take effect solely depends on the type of power of attorney. Different powers of attorney take effect at different times. While some take effect immediately, others take effect after an event such as incapacitation.
Types of powers of attorney and when they take effect
Below are different powers of attorney and when they take effect:
· Medical POA
As the name implies, this type of power of attorney is solely concerned with making decisions as regarding the health of the principal. It is a springing power of attorney as well as a durable power of attorney. This is so because it springs to effect immediately there is an occurrence of incapacitation and also because it can last throughout the principal’s life time in as much as he remains incapacitated which is likely if they have become old and developed a deteriorating mental illness like dementia. Some power of attorney terminates immediately the principal recovers. Medical power of attorney is also known as healthcare proxy.
· Limited power of attorney (conventional POA)
In this power of attorney, the principal states exactly when the effect take place and when it ends. It is very specific. It could involve the attorney-in-fact selling a particularly property on behalf of the principal. He could be making decisions on behalf of the principal when he travels abroad.
This type of power of attorney takes effect immediately and ends when the principal becomes mentally incapacitated or terminates the arrangement.
· Durable POA
This type takes effect immediately it is signed and it can continue for the lifetime of the principal unless the principal file a cancelation of agreement.
· Springing POA
This type takes effect only when an event occurs like incapacitation. It must be specified which particular event should bring this document to effect.
Why should you create a power of attorney?
Creating a power of attorney is very important for various reasons. At the event of death you wouldn’t want your estate to be mismanaged or decision regarding them to be poorly made. Hence you appoint a power of attorney. This means you authorize this person to make delicate decisions on behalf of your health and personal affairs as well as delicate decisions regarding your estate when you become incapacitated.
In the case of a health condition, probably you are under life support system, will you burden your family members and love ones with the tough decision of whether or not to pull the plug?
Power of attorney is a very essential document that is included when planning your estate. It makes provisions for eventualities. It names the person to make decisions on your behalf either at death or in a situation of incapacitation.
What happens if you don’t have a power of attorney
Not having or creating a power of attorney could really be dangerous because:
At your death or in a situation of incapacitation, your loved ones might be in confusion as there will be no one to make the calls. Your estate might be at risk of mismanagement as even your spouse reserves no right to make legal decisions on your behalf. There will be no one to make delicate calls when your health is in critical condition.
Professional help with drafting your power of attorney New York
Creating a power of attorney that is best suited for your needs is important and you can achieve this by seeking the assistance of an attorney. If you need help with drafting your power of attorney or determining which to create, our estate planning attorneys in New York are ready to assist you. We ensure your documents are compliant with New York’s law and works to your best interests.