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What is a power of attorney?

by | Dec 13, 2021 | Estate Planning

People who are creating an estate plan usually focus on passing out their assets to their loved ones. While that’s one of the main goals of estate planning, there’s much more that you should think about when you’re getting your plan together.

One component of an estate plan that you need to set up is the power of attorney designations. These give someone else the power to act in your stead to make decisions for you if you become incapacitated.

Two types of power of attorney

The two main types of power of attorney that you need to think about when you’re creating an estate plan are one for your finances and one for your medical care. You can name the same person for both but be sure they can do what you’d want to be done.

The person you choose for the financial power of attorney will be able to buy and sell things for you. They can pay your bills and take care of financial obligations.

The person you name for the medical power of attorney will make decisions about health care treatments. They work closely with your medical care team and must follow the advance medical directives that you set up to outline what medical care you’ll accept and what you won’t accept.

Anyone who’s taking care of their estate plan should ensure they have responsible individuals named in the power of attorney documents. This ensures that your wishes will be followed if you become incapacitated. Always take the time to review these designations when you’re checking over your estate plan. Working with someone who’s familiar with these situations is beneficial so you can draw on their knowledge as you get everything set up.