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Power of attorney: a hedge against the ‘what ifs’

Though none of us like to think of the "what ifs" from a negative perspective, it serves us all well to be prepared in case of the worst happening.

A "power of attorney" (POA) is a legal document that gives another person the authority to act as your legal representative or agent either immediately or at some date in the future. The power allows them to make binding decisions on your behalf. So the person you choose as your representative should be one that is responsible and trustworthy. The POA is a tool that can be used for various purposes such as finance, insurance, military, care and custody of children, and buying/selling real estate.

Although everything may be fine now, unexpected circumstances may present situations where a POA is needed. What happens if you are injured and incapacitated, who would pay your bills? How would they pay your bills? Who would make decisions regarding your medical care if you couldn't?

A POA may be "general" or "specific" in scope. The type of POA you may want to create depends upon the amount of authority you want to give your representative and how long you want them to maintain this authority.

General POA

A "general" POA is usually unlimited in scope and duration. It permits the individual named as your agent to act as your legal representative in relation to financial matters until it is revoked. Typically it is used during a period of time when you are unable to act for yourself. Under the general POA, your agent would – amongst other things – possess the authority to buy/sell and manage property/real estate; perform banking transactions; prepare and file tax returns; enter into contracts; and purchase life insurance. This is a power responsibility and should be bestowed upon someone mature and experienced enough to handle the responsibility.

Limited POA

A limited or "special" POA authorizes your agent to act on your behalf only in specific situations as identified in the document. For example, you may be unable to handle your affairs because of other obligations. While most limited POAs are not as broad as general POAs, they may cover some of the same areas such as the authority to make financial decisions; manage business interests; buy/sell and manage property/real estate; enter into safety deposit boxes; and perform banking transactions.

Health care POA

In the event that you become ill, who makes the decisions for your treatment if you cannot? With a health care POA in place, your agent would make those decisions on your behalf, if you are incapacitated, unconscious, mentally incompetent, or simply unable to do so. If the situation arises when you cannot articulate your medical wishes, the health care POA is the perfect solution to have in place. This POA doesn't surrender your right to give your doctors direction when you're able to do it yourself. It only becomes effective when you cannot give direction to your health care professionals.

Without a health care POA in place, your family may be forced to pursue legal action to appoint someone, especially in the case where there are multiple parties with an interest and desire to control the situation. Remember, in this situation the court may not appoint the person that you would have chosen because the court doesn't know them as well as you do. It is best to appoint someone when you are healthy and in control rather than wait until a crisis.

Durable POA

Use of the word "durable" in a POA allows your agent to exercise powers that you may or may not be able to perform. A durable POA, whether it's general, limited, or for health care, may allow your representative to carry out the powers you granted, whether you have a disability or not. This makes it is possible for your agent to do things on your behalf behind your back, so it's important to pick someone honest, trustworthy, honorable, responsible and dependable.

Springing POA

A springing POA limits the power of a durable POA, adding language that limits the power to situations of documented incapacity or disability. Problems and delays may arise while your agent is waiting to receive the documentation regarding the incapacity or disability.

NEXT: The need for wills and trusts.

(Contact Carlee McCullough, Esq., at 5308 Cottonwood Road, Suite 1A, Memphis, TN 38118, or email her at This email address is being protected from spambots. You need JavaScript enabled to view it. .)


0 #1 Ezzeldin Abdelhamid 2012-11-20 14:09
is the POA of his Mother can stop me taking my mother out of the nursing home because my Mother like to get out of the nursing home and it is against her well and against her wish to stay there (she is 84 Y and she said it her self

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