Making crucial decisions for aging parents can be challenging but obtaining a power of attorney (POA) provides peace of mind and clarity. A POA allows individuals to manage finances or make medical decisions on behalf of their parents when they are unable to do so due to age or illness. While it may be difficult to discuss, having these conversations early ensures that you follow their wishes as their health changes.
According to the American Bar Association, a POA is a legal document that allows an appointed person (agent) to act on behalf of someone else (principal). The agent can only perform actions specified in the POA document. The principal can still make decisions if they are coherent, meaning the agent doesn’t have exclusive decision-making power.
Types of POA
• General POA: The agent manages the principal’s affairs for a specific period and the principal can revoke it anytime. It ends if the principal becomes incapacitated.
• Durable POA: Continues even after the principal becomes incapacitated and ends upon the principal’s death or completion of specified conditions.
• Springing POA: Becomes effective only if the principal becomes incapacitated, allowing the principal to control their affairs until then.
• Medical POA: Allows the agent to make medical decisions for the principal until they regain competency or the document’s specified period ends.
• Limited POA: Grants the agent authority over specific tasks like paying bills or selling a house, usually temporary and ending if the principal loses capacity.
When and why should you consider a POA?
If there are finance issues. It ensures bills are paid and finances are managed when parents struggle with these tasks.
In case of serious illness, a POA allows parents to focus on recovery without the stress of managing their affairs.
A POA may be necessary for managing affairs if parents develop dementia and should be obtained before they lose capacity.
A POA can be helpful during surgery for managing affairs and making decisions until parents recover.
And if parents frequently travel, a POA will keep their affairs in order while they are away.
Trust is crucial when selecting a POA. Choose someone reliable who will act in your parents’ best interests. While family members are often chosen, an objective outsider like a lawyer or accountant can also be considered, though it may incur additional costs.
Discuss this thoroughly with your parents to understand their needs and preferences and clarify your parents’ expectations. For instance, medical decision-making requires more involvement than financial assistance. Also, understand the financial implications of becoming a POA.
Discussing POA can be sensitive. Approach with empathy, emphasizing support and only using POA powers when necessary. This reassurance can alleviate your parents’ concerns. Consider consulting an experienced estate planning attorney for objective advice and to address any concerns your parents may have.
Send your questions to ccolan@colanlegal.com and use “Alpine Mountaineer estate planning question” as the subject. We’ll answer your questions in our upcoming issues.
This article is provided by your local estate planning attorney, Corina Colan.
The Law Office of Corina I. Colan / (909) 265-3315 / www.colanlegal.com
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