Four Important Terms Related to Powers of Attorney

A power of attorney can be specially crafted to align with your individual needs and expectations. It is very important to familiarize yourself with some of the different aspects of different power of attorney forms to ensure that you have selected the right type of power of attorney based on your individual circumstances and the person you intend to appoint.

A power of attorney allows you to name an individual referred to as an agent or an attorney in fact who will act in your place in the event that you become incapacitated and are unable to act on your own. There are four primary types of powers of attorney:

  • A general power of attorney gives your agent all of the powers and rights that you have yourself, such as signing documents or making financial transactions and more. This is often used by people who are not incapacitated but need additional support with their financial management.
  • A limited power of attorney names explicit rights to a power of attorney agent has when it comes to acting in your stead.
  • A springing power of attorney enables your attorney in fact to step in and make decisions on your behalf if you become incapacitated but it’s not effective till you do become incapacitated. When using a springing power of attorney, it is very important that the standards for determining that you are incapacitated and triggering the action in the power of attorney are clearly laid out.
  • A durable power of attorney can be limited or general in scope but stays in effect after you have become incapacitated. No one can represent you if you have become incapacitated without a power of attorney unless a court appoints a guardian or a conservator. Your durable power of attorney is a key document and a component of your estate plan that will remain in effect until you pass away unless you rescind it while you are not currently incapacitated.

For further information about creating your own power of attorney document, set up a time to speak with an estate planning law firm today.

 

 

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