Interested in getting yourself a power of attorney? Don’t know which type will be the best for you? Check out our article to learn more about them!
A power of attorney can be of great benefit to your estate plan. For those who are unaware, it’s an estate planning document that allows you to appoint an agent to handle your affairs.
There are also different types of power of attorney. Every one of them serves a different purpose and some grant differing levels of power to your agent.
For instance, a general power of attorney will allow an agent to handle all your legal and fiscal affairs. This can come in handy if you’re out of the country for a long period of time.
So, if you’re interested to learn more about the different types and how this can help your estate plan, you’ve come to the right place! We’ll be covering all of them. Let’s get into it right away.
General Power of Attorney
As we mentioned before, a general power of attorney allows your agent to have a huge amount of power to act on your behalf. They have the power to make any legal, financial, real estate, and business decisions in your place.
The agent can also buy and sell property in your name, enter contracts, pay bills, and manage banking transactions. So, keep in mind that giving your agent this much power should only be used for short periods of time.
This is only recommended when and if you are unable to physically or mentally manage your affairs. For instance, if you’re traveling abroad for a long period of time, it makes sense to let an agent handle your business while you’re away. For example, your agent can complete a power of attorney form in NY if that is where they are based. Forms are also available for other states.
A general power of attorney can dissolve if you’re disabled or incapacitated. Therefore, make your decisions wisely.
Durable Power of Attorney
A durable power of attorney is basically the same as a general power of attorney. It can be used to give an agent the power to manage all your affairs when you become unable to do so.
The only difference is incapacitation. A durable POA doesn’t have a set time period. It becomes active at the moment of your incapacitation and it’ll only expire upon your death.
So, do a great deal of thinking before you choose this type of power of attorney.
Non-Durable Power of Attorney
The non-durable power is much less encompassing than a durable power of attorney. This power of attorney is only used for a set period of time. It’s usually for a specific transaction that grants the agent power to act on your behalf.
Once the transaction is complete, or if the principal becomes incapacitated during the course, then the non-durable POA dissolves and ceases to exist.
Limited or Special Power of Attorney
A limited or special power of attorney is, as you’ve guessed, used on a limited basis.
This particular POA is seldom used when the principle involved is unable to finish their transactions. It can happen due to illness or prior commitments, and they want to appoint an agent to act on their behalf.
This agent can then sell a property and make financial or banking transactions for a limited amount of time. Beyond that, an agent has no authority to do or act on anything that the principal hasn’t assigned them to do.
So, if you’re going with this type of POA, make sure you’ve thought it through. After all, it’s a special type of POA.
Medical Power of Attorney
The medical POA is quite straight and simple. It authorizes the agent to take specific control over healthcare decisions when the principle becomes incapacitated or unable to do it themselves.
Moreover, this POA starts to take effect upon the consent of their current physician. This then allows the agent to have the power to authorize all medical decisions related to the principal on their behalf.
For instance, let’s say you have aging parents and they’re at a point in their lives where they can’t make any decisions by themselves. As their child, they can appoint you as their agent and then take all the necessary decisions on their behalf. This is where a medical power of attorney can be really helpful to you!
Springing Power of Attorney
Finally, our last type of POA: the springing power of attorney. This is an effective power of attorney to cover incidents that may occur in the distant future, such as the incapacitation of the principal or when a triggering event has occurred while they are out of the country and unable to do anything about it.
This type of POA can either be durable or non-durable. The agent can cover any number of affairs determined by the principal. Either way, whatever circumstances you’re facing, there’s a POA form that can be customized specifically to meet all your needs.
Remember, this is a valuable tool to help someone and assist them with their legal needs. Whether it’s to take charge of a business deal the principal can’t attend or they’re incapacitated because of other obligations, the POA gives people security and flexibility. They can safely leave it in the hands of the agents to look after their affairs in a responsible and respectful manner.
In conclusion, we’d like to say that we hope you’ve learned and understood the different types of power of attorney that are available to you. Now that you’ve gained some valuable insight, we hope you can confidently make your decision and choose the right type to include in your estate plan.
Don’t forget to do your research and strive to keep learning more. It’ll benefit you greatly when the time comes. Also, don’t forget to share this article with your friends and family; you never know who might need it!
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