What Is Power Of Attorney, And How Do I Set One Up?

As we go through life, there may come a time when we need to grant someone else the authority to act on our behalf. This could be due to a variety of reasons such as illness, disability, or travel. One way to accomplish this is by setting up a Power of Attorney (POA) agreement. In this article, we will explore what a Power of Attorney is, how it works, and how to set one up.

What Is a Power of Attorney?

A Power of Attorney is a legal document that allows an individual (the principal) to grant someone else (the agent or attorney-in-fact) the authority to act on their behalf. This authority can be broad or limited, depending on the terms of the agreement. The agent can be authorized to handle financial matters, make medical decisions, or carry out other tasks on behalf of the principal. The key point to remember is that the agent only has the authority granted to them in the Power of Attorney agreement.

Types of Power of Attorney

There are different types of Power of Attorney, and the type you choose will depend on your needs. Here are some common types:

1. General Power of Attorney: This type of POA gives the agent broad powers to act on behalf of the principal. The agent can make decisions related to finances, real estate, and other matters.

2. Limited Power of Attorney: This type of POA limits the agent's authority to a specific task or timeframe. For example, a principal may grant a limited POA to someone to sell their house while they are out of the country.

3. Durable Power of Attorney: This type of POA remains in effect even if the principal becomes incapacitated. This means that the agent can continue to act on behalf of the principal if they become unable to make decisions for themselves.

How to Set Up a Power of Attorney

Setting up a Power of Attorney involves a few key steps:

1. Choose an agent: The agent should be someone you trust to act in your best interests. It is important to choose someone who is responsible and reliable.

2. Decide on the type of POA: Consider your needs and choose the type of POA that best suits your situation.

3. Draft the agreement: The Power of Attorney agreement must be in writing and signed by the principal. Some states require the agreement to be notarized or witnessed by witnesses.

4. Obtain legal advice: It is always a good idea to seek legal advice when setting up a Power of Attorney. An attorney can help you understand the legal implications of the agreement and ensure that it is valid under state law.

5. Keep the agreement up to date: It is important to review the Power of Attorney agreement periodically and update it if necessary. This can help ensure that the agreement remains valid and reflects your current wishes.

Conclusion

In conclusion, a Power of Attorney can be a valuable tool for granting someone else the authority to act on your behalf. By understanding the types of POA available and following the steps to set one up, you can ensure that your interests are protected. If you have any questions or concerns about setting up a Power of Attorney, it is always a good idea to seek legal advice.

References:

• "Power of Attorney," Legal Information Institute, Cornell Law School, https://www.law.cornell.edu/wex/power_of_attorney.
• "What is a Power of Attorney?" American Bar Association, https://www.americanbar.org/groups/real_property_trust_estate/resources/estate_planning/what_is_power_of_attorney/.

By taking the time to set up a Power of Attorney, you can ensure that your wishes are carried out even if you are unable to make decisions for yourself. Whether you need a general, limited, or durable POA, working with an attorney and selecting a trusted agent can help provide peace of mind and protect your interests.