People creating an estate plan in the Greensboro, North Carolina area often include a durable power of attorney. But what is a durable power of attorney? What makes a durable power different from other types of powers of attorney, and what does a power of attorney actually do? Let us take a look at some commonly asked questions surrounding these important documents.
What is a power of attorney?
A power of attorney is simply a document. Through this document you can choose someone who can represent your interests and make decisions on your behalf. A person who creates a power of attorney is call the principal, while the person chosen to represent your interests is called either an agent or an attorney-in-fact.
What is a durable power of attorney?
Durable powers of attorney are designed to allow your agent to act on your behalf should you become incapacitated. Regular, or non-durable powers, only allow your agent to make decisions as long as you are still capable of making decisions yourself. With a non-durable power, your agent’s authority terminates as soon as you become incapacitated or otherwise lose the ability to revoke the powers you granted. With a durable power of attorney, your agent maintains his or her authority even after your incapacitation.
Are there different types of durable power of attorney?
Yes. Durable powers of attorney come in two main forms: health care and financial powers. As their names imply, a health care power allows you to appoint an agent who will make medical decisions for you, while a financial power will give your agent the ability to manage your financial affairs. Both of these documents are essential when creating an estate plan because they address two separate, but equally important, areas.
What is a general durable power of attorney?
In some situations, you might create a general durable power of attorney. This type of power is designed to address all the issues you might face if you become incapacitated. Some people, for example, might want to create only a single power of attorney documents and give the agent the ability to make both medical and financial decisions.
What type of document do I need to create?
That depends on your circumstances. In most situations, creating a financial and health care durable power of attorney will be sufficient. However, some people have unique needs and desires that might necessitate fewer, or more, power of attorney documents. There is no way to know what kind of documents you will need to create until you speak to an estate planning attorney to discuss your concerns and your options.