How to Choose the Right Power of Attorney
When you sign a power of attorney document, you give a trusted person the ability to make decisions on your behalf. It is one way to protect your funds should you become incapacitated later on.
It's also a convenient way to alleviate yourself of the pressures of financial decision-making if you choose to. If you've reached the stage where you'd rather focus on your enjoyment and health, it may be time to hand over your affairs to someone with more time and energy.
Read on to discover how this part of the estate planning process works.
Defining a Power of Attorney
A power of attorney grants a chosen person, known as the agent, the ability to make decisions on behalf of the principal. This agent has a fiduciary duty to act in the principal's best interests, but it's still important to choose a highly trusted person to fulfill this role.
Much depends on the language used in a power of attorney document.
Types of Power of Attorney
Indiana recognizes two main types of power of attorney, i.e., a general power of attorney and a special power of attorney.
The first allows the agent to oversee all of the principal's affairs, while a special power of attorney limits their responsibilities to specific aspects. All types of POAs may be durable, nondurable, or springing.
A durable power of attorney document remains legitimate regardless of the principal's health. A nondurable POA expires when the principal becomes incapacitated.
In these cases, a court may appoint a conservator to oversee the principal's affairs. A springing power of attorney only comes into effect when the principal becomes incapacitated or develops a debilitating disease.
Additionally, the state recognizes two other specific types of POA, namely:
Financial Power of Attorney
This POA allows the agent to manage the principal's business and financial matters. The agent has the power to do things like deposit checks at their bank, pay their bills, and sell or mortgage their home.
They can also file their taxes, provided they register with the Indiana Department of Revenue.
Medical Power of Attorney
A medical POA allows the agent to make healthcare and medical decisions for the principal. This document is called a POA for 'health care and appointment of a health care representative'.
An agent with a medical POA can:
Dictate Medical Care
The agent has far-reaching powers concerning the principal's healthcare. They can decide on hospital care, psychiatric treatment, and home care.
A healthcare power of attorney can even decide which care providers and doctors the principal uses, but these choices may depend on the approval of a financial POA.
Determine Living Conditions
A medical POA allows the agent to decide on residential long-term care for the principal, such as:
- Assisted living
- Nursing homes
- Memory care
They may even have the authority to control the principal's diet and who bathes them.
Things a Power of Attorney Agent Can't Do
There are certain things that no power of attorney agent can do. These are:
- Change the principal's will
- Transfer the POA to someone else
- Act in their own interests
- Make decisions after the principal passes away
If the principal passes away without a will, the POA agent could be appointed as the executor of the estate.
Major Considerations When Setting Up a POA
Setting up a POA isn't something you should take lightly. From a legal perspective, you must be of sound mind when you create it.
You must take the following into account when setting up these legal authority documents:
Legal Capacity and Consent
In Indiana, you must sign a POA in the presence of two witnesses, or the notary public. The witnesses cannot be:
- Someone named as an agent in the POA
- Anyone who is granted a benefit or power in the POA
- A spouse or descendant of the above
The Agent's Trustworthiness
When you sign a POA, it gives you some power over your finances and health when you are no longer able to manage these aspects. It doesn't necessarily mean giving up your independence.
A power of attorney gives a like-minded family member the power to act in your best interest, and it's vital that you can trust them to do what you would prefer.
Discussing your preferences and intentions with your intended agent beforehand can help ease this transition and give you peace of mind.
The Scope of Authority
A POA should always be drafted according to the principal's needs. In some cases, families may choose to do this together, or the principal may decide to set the terms.
Despite the overall types of POAs, these legal documents are highly flexible, and you can draft them according to your unique needs. It's best to engage a legal expert to ensure you phrase everything correctly and leave no gray areas.
Steps for Setting Up a POA
Once you've decided to start the power of attorney process, it's a relatively simple thing to do. These are the steps involved:
- Select your agent or agents
- Draft the POA with legal assistance
- Sign and execute the document
Once you've signed the POA, it becomes legally binding, but you can meet with your agent and attorney to review it from time to time. As long as you are of sound mind, you can amend or revoke a POA as you see fit.
It's best to forward copies of the POA to your attorney as well as any affected parties, such as the recorder's office if the agent has control over your real estate.
Enjoy the Power of Peace of Mind
Setting up a power of attorney is an excellent option for seniors who are finding it increasingly difficult to cope with the day-to-day demands of managing their affairs. These legal documents help ensure they'll be taken good care of if they become incapacitated.
If you want to spend your later years being taken care of the way you choose, Addison Place Assisted Living is a perfect choice for you. Our caring, friendly personnel are committed to ensuring our residents enjoy all the best benefits of assisted care and enjoy an active and engaged experience while staying with us.
Schedule a tour to discover the best option for assisted living and memory care in New Castle, Indiana.