A power of attorney form is a legal document that gives powers to another individual to make decisions for them. Usually this includes financial decisions. For medical decisions, we use a form called the Advance Healthcare Directive. You can read more about that here.

The power of attorney is only useful when you are alive, but it will continue should you become incapacitated. This allows another individual to take care of your assets and ensure that you and your dependents are being taken care of financially if you could not do this yourself.

You can make your power of attorney contingent upon your incapacity, meaning that the powers in it are only active once you become incapacitated. Or you can have it be a standing power of attorney which means that the powers are active as soon as you sign it.

I find that sometimes, older clients, prefer a standing power of attorney so that their adult children can help them with their finances. This is also a much safer route to go than to put an adult child on a bank account with you, because a power of attorney puts that child in a fiduciary position, which means that if they mismanage your funds, they have criminal and civil liability.  

If instead, you put them on your bank accounts, vehicle, or home as a joint owner, that means that they are legally entitled to those assets. That those assets are also now exposed to any liabilities they may have like debt or law suits. And that upon your death, they would legally own all of those assets. There is very little legal protection to you because they are technically a joint owner of the assets.

Everyone needs a power of attorney and every Really Good Will package includes a power of attorney. Take the Really Good Wills Assessment to find out if our product is a good fit for you and get started on claiming a little more peace of mind for yourself and your loved ones.