The Power of Attorney, or POA, is one of the most important estate planning documents—but also one of the most misunderstood. A POA allows you to appoint a person, or in some cases an organization, to make key decisions for you should you ever become unable to do so. Not all POA documents are created equal, though; they allocate different levels of power to the person appointed to make these important decisions.
As you consider adding a POA to your estate plan, then, it is helpful to understand the basic types.
Different Kinds of POAs
- A General Power of Attorney is so named because it endows broad powers; the individual appointed to make decisions for you is given the agency to handle important financial and business transactions, settle claims, buy life insurance, make gifts, and more. You might include a General Power of Attorney in your estate plan to ensure that a trusted friend or family member can make all financial decisions for you should you become incapacitated.
- A Special Power of Attorney, meanwhile, is one that specifies a very particular range of decisions that the individual can make, offering much more limited power.
- A Health Care Power of Attorney empowers the appointee to make medical decisions for you should you become mentally impaired, incapacitated, or otherwise unable to make your own decisions.
- A Durable Power of Attorney offers a durability provision, keeping an existing POA in effect should you become incapacitated while that first POA is in place.
Powers of Attorney and Your Estate Plan
To speak with a legal professional about how a POA might enhance your estate plan, we invite you to contact the Singh Law Firm directly. We can help you determine which, if any of these documents is right for you.