Imagine you suddenly become incapacitated because of illness, injury or old age.
Or, maybe you dont feel as sharp as you used to.
Who would make decisions about your health care, finances and overall well-being?
If youve created a durable power of attorney, the answer is easy.
This legal document empowers someone you trust to make decisions on your behalf when you cant.
What Is a Durable Power of Attorney?
The agents authority over your money and health care decisions can be very broad or very narrow.
Decisions outlined in a power of attorney arent written in stone.
As the principal, you’re free to change or get rid of your DPOA at any time.
Otherwise, your agent cant continue acting on your behalf when you need it the most.
They no longer use the terms durable, nondurable and springing.
Here is the step-by-step process of creating a durable power of attorney.
Many financial institutions also make power of attorney forms available to customers.
you might find the template for your specific state by Googling durable power of attorney [your state].
Choose an Agent
Selecting the right person to be your agent is crucial.
Look for someone who is reliable, responsible and capable of making complex decisions about your health and finances.
Be honest with potential agents about the responsibilities involved.
it’s possible for you to choose anyone over the age of 18 to be your agent.
This can be a family member, a friend or even a financial advisor.
Add Specifics to Your Power of Attorney
Consider the pop in of durable power of attorney you want.
Do you need someone to manage your finances, make health care decisions or both?
Decide how much authority you want to grant your attorney-in-fact.
By being specific, you’re able to avoid misunderstandings later on.
Sign and Notarize
confirm everyone understands their roles and responsibilities.
You should also give your doctor and health care facility a copy of your medical durable power of attorney.
Keep the original document in a secure location that you could easily access when needed.
Advanced care planning refers to preparations made to address unforeseen circumstances in the future, such as becoming incapacitated.
Consulting with a lawyer to get all these documents in order is a good move.
But heres an overview of what you might encounter.
The power of attorney document itself can also include specific conditions that limit the agents authority.
you could do this by creating a new document that revokes the previous one.
Rachel Christian is a Certified Educator in Personal Finance and a senior writer for The Penny Hoarder.
She focuses on retirement, Medicare, investing and taxes.
