Creating your estate plan involves more than just saying who gets which assets after you’re gone. A primary component of a plan is setting up guidelines for healthcare and finances if you’re incapacitated. This is done by setting up power of attorney designations.
The beauty of a power of attorney lies in its flexibility. You can tailor it to suit your specific needs, choosing what powers to grant and when those powers should take effect. It could be as broad as making all medical decisions for you or as narrow as selling a particular stock.
Medical power of attorney
A medical power of attorney gives someone the ability to make your healthcare decisions. It goes into effect if you’re unable to make medical decisions for yourself. By appointing someone you trust as your medical POA, you can ensure they can make decisions that are in your best interests. This authority can cover many decisions, from the types of treatments you receive to end-of-life care options. This ensures your healthcare preferences are heard and respected, even when you can’t voice them yourself.
Financial power of attorney
A financial power of attorney allows someone to make decisions about money matters for you. This includes managing assets, paying necessary bills and buying or selling assets. You can name exactly what you want them to take care of on your behalf, so this can be as general or limited as you desire. The person who has the power of attorney for your finances must be able to make decisions based on what’s best for you. They can’t have self-serving tendencies since they’re entrusted with so much.
Communicating with the designees
Discussing your wishes with the individuals who will make these decisions for you is critical. The more information they have about your wishes, the more likely they’ll be to make decisions accordingly.
Remember, the power of attorney designations are only one small part of a comprehensive estate plan. Working with a legal representative who can help you ensure everything is covered is critical.
