Power of Attorney: Should You Appoint One In the Case of Illness or Death?
Planning for the future involves retirement savings, estate planning, and many other considerations. Determining how your health and finances will be managed if you’re unable to do so must be part of this planning. When you can’t make choices about health and finances for yourself, a power of attorney ensures your wishes are carried out by a trusted agent. At Park Place Financial, we can help you learn more about medical and financial power of attorney and why both should be essential components of your overall planning strategy.
What Is a Power of Attorney?
POA (Power of Attorney) is a legal document that lets you give another person the power to act in your place when you’re unavailable. The DPOA (Durable Power of Attorney) is part of this document and grants an individual of your choice the power to act on your behalf should you become incapacitated. Whether you’re unable to manage your affairs due to a sudden accident or serious illness, the representative you choose should be a trusted individual who will act in good faith and according to your wishes. Some people also appoint a backup agent who can act in the event the primary appointee is unable to do the job.
Making these types of appointments is a significant decision. When it comes to personal and estate planning, medical and financial powers of attorney are two key elements that help ensure your health and assets are in good hands. Criteria to consider include:
- Specific state regulations regarding appointments
- The ability of an agent to discuss medical and end-of-life care
- The willingness of an agent to communicate your wishes and values
- The capability of an agent to advocate on your behalf in stressful situations
A certified financial planner and an estate planning attorney can guide you through this process and help you review your plans periodically.
Medical Power of Attorney
As uncomfortable as it may be to approach the subject, a medical power of attorney can provide great peace of mind. Not just for end-of-life care, this directive is activated under a variety of circumstances that would result in the inability to communicate, such as:
- Mental health lapses
- Terminal illnesses
During your time of need, the appointee communicates with healthcare providers on your behalf. They'll take care to ensure your wishes are met, such as:
- Types of medical treatments administered
- Length of time to continue medical treatments
- CPR and other life-saving measures
- Choosing long-term care facilities
Medical Power of Attorney vs. Living Will
Medical power of attorney is similar to a living will, but can be activated at any time throughout your life. A living will is generally used for end-of-life decisions. It's a written set of instructions that outlines your preferences for medical care that may include:
- DNR/DNI orders
- Mechanical ventilation
- Tube feeding
- Palliative care
- Organ and tissue donations
While also specifying care directives, a living will is less flexible than your chosen POA. Your healthcare proxy has the ability to pivot and adjust directives when faced with unpredictable events. To cover all their bases, many people make plans for both.
Financial Power of Attorney
The financial power of attorney is used to designate someone to handle your finances on your behalf. Whether it's due to medical incapacity or the physical inability to handle a transaction, this agent can be authorized to perform a variety of simple and complex financial tasks, such as:
- Urgent transactions that can't wait for your return
- Routinely depositing Social Security checks
- Overseeing investment and retirement accounts
- Filing tax returns
- Managing real estate
- Purchasing insurance
Your designated agent doesn't have to be an expert in the field. Instead, they can hire professionals for help. These professionals would be paid with your assets along the way. The most important thing is to select someone you trust to carry out critical financial responsibilities in your absence.
How Can My Financial Planner Help?
Financial planners and estate planning attorneys can help ensure you have the proper legal documents in place that designate someone to act on your behalf. Your certified financial planner may also assist in bringing your long-term goals to fruition, while your estate planning attorney helps you remain in control of your assets. The documents for each agent will be different in nature, and a professional can make sure each one is completed properly.
Speak with a Financial Planner Today
From developing a personalized plan for success in the present to preparing for unforeseen events in the future, making these decisions can help pave the way for a smoother journey ahead for you and your family. At Park Place Financial in Bellaire, Texas, our trusted financial planners always work with your best interests in mind. Let us help you create your long-term plan. For more information about estate planning, schedule a consultation today.