While making an estate plan, you may want to include a power of attorney. By using this document, you can authorize an agent to make decisions for you. If you become incapacitated and you can’t make those decisions on your own, the legal ability passes to a person of your choosing.
You can simply use a single power of attorney if you would like, but there are generally two different main classifications. It may be helpful to choose different agents to fulfill these different roles.
Medical decisions
First of all, a medical power of attorney revolves around healthcare decisions. Should you be put on life support? What type of treatment do you want? Are there any treatments that you do not want? If you’re not in a position to work with your medical team and make these decisions – such as if you’re being kept in a medically induced coma to save your life – it’s important to have an agent who can do so.
Financial decisions
A financial power of attorney revolves more around money-related decisions. Who is going to pay your medical bills? Who will pay your monthly costs, such as utilities or a phone bill? Who has to pay your taxes? Is anyone else allowed to access your financial accounts, like an investment account or a bank account?
Of course, the two situations can be related. You may need your agent to make medical decisions for you and to authorize payments for that medical care. Either way, you can see how planning in advance is so beneficial, which is why it’s crucial to know how to use a power of attorney and other estate planning documents.