Having a will is rarely enough.

Life brings us too many unique situations that would not be resolved by a will. Sometimes we need a more robust framework of documents.

And one of the all-stars in that framework is a power of attorney.

From the time they married, Marisa and Edgar did things right, especially when it came to insurances and retirement planning. And despite earning moderate incomes – and dealing with life’s curve balls – their retirement looked just like their plans. So, when the doctor told Marisa she had Stage 4 ovarian cancer, it felt as if everything had suddenly unraveled.

The next year was a whirlwind of chemo and other treatments, but nothing halted the disease. Eventually, the only option was to try an experimental drug. The catch? The insurance company refused to cover it. Edgar’s pension could not be used as collateral for a loan. But Marisa’s IRA held what they called their “what if” money.

Before Marisa could authorize a withdrawal from her IRA, she slipped into a coma. Her life-saving treatment hung in the balance. Luckily, as part of their estate planning both had signed Durable Powers of Attorney, and Edgar could access the funds that gave his wife one last chance at life. A real what if.

So, what is a power of attorney?

A power of attorney is a document, often part of estate planning, that grants someone the authority to make decisions regarding different aspects of your life. You are giving a trusted person of your choice – who does not have to be an attorney – the right to act as your agent in either specific or general situations, depending on the type of power of attorney.

Each of the common types of power of attorney performs a slightly different function. As you come to understand them better, you will want to have a competent professional incorporate them into your estate plan, completing whatever authentication process is required by the state where you live. You will have to be of sound mind at that time.

Which type of power of attorney does what?

The different types of power of attorney may overlap in certain circumstances, but in general, this is how they are defined:

A General Power of Attorney has the broadest scope and gives your named agent the authority to make decisions and act on your behalf. Ideally your document will list all the actions you want your agent to take. The agent has a legal responsibility to act in your best interest and can be held accountable by a court. However, your trust in the person should be absolute as this type of document is the most prone to abuse, due to its general nature.

A Limited, Specific or Special Power of Attorney only applies to a very particular area of your life and can be limited in its timeframe as well as scope. An example would be to extend authority to your chosen person to maintain, manage or sell a property for you at long distance.

A Durable Power of Attorney is valid whether or not you have mental capacity. (Other powers of attorney do not.) It can either become effective upon incapacitation or remain in effect despite incapacity. Your chosen agent will be able to make medical and financial decisions for you seamlessly, without a court having to become involved.

A Springing Power of Attorney is only triggered if certain conditions are met, usually upon the loss of mental capacity. However, those conditions must be very carefully defined, so no institution balks at fulfilling your wishes and costs precious time. Although most abuse occurs during incapacitation, many people choose the springing option to avoid any misuse while they are still capacitated. In reality, if you feel the need to protect yourself so, you have probably not chosen the right person to entrust your affairs.

A Healthcare Power of Attorney may go by different names but gives someone the necessary authorization to make healthcare decisions for you if you are disabled through illness or accident. Those decisions may range from simple intubation to disconnecting life support. Your chosen person should know your expectations in detail before you grant such power over your life.

Pitfalls to avoid with a power of attorney

A power of attorney is meant to facilitate getting your wishes fulfilled. However, some troublesome situations can arise if you do not work with a qualified estate-planning professional. For example:

• Insufficient detail for the document to be legal and practical.

• The wrong type of power of attorney for what you want to achieve.

• Not meeting the specific requirements of the state in which you live.

• Choosing an agent whom your advisor would have red-flagged.

• Downloading an imprecise generic document from the internet.

Reversing a power of attorney

Issuing a power of attorney can feel frightening, and we do make mistakes. However, you can always reverse that decision, if mentally competent. However, the revocation process varies by state, so legal counsel should be sought for your protection.

If prepared carefully within an overall estate plan and if you name a person whom you trust wholeheartedly, a power of attorney is the best way to be sure your wishes will be followed.

Remember that, when it really mattered, that was the only way Edgar could fulfill the commitment he had made to the love of his life. What commitment do you need to make to the love(s) of your life to ensure they are protected?

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