Many families do not realize that there are several differing types of power of attorney documents, and that they all have different purposes. While a general power of attorney can be prepared in estate planning, there are other circumstances that will need a more specific power.
A durable power of attorney is the exact same as a general power of attorney, with one exception. Under a durable POA, if the principal were to become incapacitated or determined unfit to make decisions, then its powers continue and your designated agent can continue to make decisions.A durable power of attorney is irrevocable, whereas a general POA terminates upon incapacitation.
Another type of POA is durable with springing powers. This is essentially a durable power of attorney, as defined above, with the stipulation that it will only become effective, or “spring” into action, when the principal has become incapacitated. For example, if this POA exists, and the principal were to suffer a catastrophic injury in a car accident that left that individual unable to make decisions, then these powers would spring into effect. The designated agent would then legally be allowed to make decisions for them.
A financial power of attorney can give a designated agent the right to use the money in a principal’s bank accounts. In addition, he or she could also buy and sell stocks, or file and pay taxes.A childcare POA can give a designated agent the right to make important decisions regarding children in your absence.A healthcare power of attorney, sometimes referred to as an advanced directive, can give the power to make healthcare decisions on a principal’s behalf. For these in particular, it is important to discuss desires and intentions regarding quality of life prior to the need for decisions to be made if at all possible.
An estate planning attorney can be instrumental in helping a family decide which power of attorney best fits their unique situation. These documents can alleviate much stress and anxiety over making important decisions in tough circumstances.
Source: MoneyCrashers.com, “What Is Power of Attorney & How to Get It – Types,” Mark Theoharis, Accessed Feb. 20, 2018