Power of Attorney identifies who has the authority to make your financial decisions if you are not able to make them for yourself. When you create your estate plan with your attorney, you will discuss a component that outlines what happens if you become incapacitated. In the event of incapacity, your Power of Attorney will make decisions over your property and finances.
Let’s explain the different types of Power of Attorney that you will want to consider when creating your estate plan:
Limited vs. General Power of Attorney
Limited Power of Attorney gives someone the ability to act on your behalf for a specific time and/or specific matter. For example, you may be closing on a house and will not be in town when you need to sign the closing documents. You can appoint a Limited Power of Attorney to someone so they can sign the contracts on your behalf when you are unable to do so yourself.
General Power of Attorney is appointed for an indefinite time and/or multiple matters. In most cases, a General Power of Attorney will sign documents for you and handle your financial transactions, like paying your bills and taxes. Essentially, General Power of Attorney is like appointing one or more people to handle multiple Limited Powers of Attorney. A General Power of Attorney’s rights end as soon as you revoke it or pass way.
Durable Power of Attorney vs. Springing Power of Attorney
Durable Power of Attorney allows you to appoint someone for Limited or General Powers of Attorney that goes through the duration of any incapacity. A Durable Financial Power of Attorney goes into and continues to give them that power through the duration of any incapacity. A Durable Power of Attorney can be used for a Limited or General Power of Attorney. If you do not appoint a durable power of attorney and you become incapacitated, no one can represent you until the court appoints a guardian or conservator.
Springing Power of Attorney only comes into effect when a doctor determines you are incapacitated and stays in effect until you are no longer incapacitated or pass away. In this case, you must determine the parameters of what you consider as incapacitated in your Power of Attorney. This is also subject to a doctor’s determination to see if you are incapacitated. These parameters will outline when a springing power of attorney becomes effective immediately.
Power of Attorney gives you more control over important matters should you need assistance or become incapacitated. However, we understand it can be difficult to navigate the different options and emotionally draining to discuss the parameters. We are here to guide you through the Power of Attorney process and ensure you feel at ease throughout the process.
If you have any questions regarding wills or power of attorney, please contact us today at firstname.lastname@example.org or 410-296-6777. We would be happy to assist you and answer your questions.