August Topic of the Month: Power of Attorney: What should you know?
Perhaps you’re familiar with the term “power of attorney” (POA), but do you know what exactly a POA does and what different types there are? Essentially, a POA is a legal document that allows you to appoint another person who will act in your best interest should you become incapacitated and thus unable to do so. If you are selecting a POA, you might consider a close friend, family member, or trusted individual who will put your needs first.
You can decree POA for a variety of purposes, including making financial decisions, making monetary gifts, making healthcare decisions, and making recommendations for guardianship of minors as necessary. There are four different POA’s, each of which has the power to make one or more of the decisions above. We’ll go into more detail about each POA below.
General POA allows the agent you decree to perform almost any act. This includes opening financial accounts and managing personal finances. The general POA is terminated when the principle becomes incapacitated, revokes the POA decree, or passes away.
Durable POA designates another person who will act on the principals’ behalf similarly to the general POA. However, this includes a durable clause and thus the agent maintains power after the principal becomes incapacitated.
Special or Limited POA assigns the agent specific powers, but they are limited to a specific area. For instance, this type of POA might have the authority to sell a piece of real estate or to make a medical decision.
Springing Durable POA is only available in some states. This type of POA becomes effective when a specific event occurs, such as when the principal becomes incapacitated.
While you will have to decide what the best type of support is for you and your needs, understanding the different types of POA can help you make decisions about the support you will need. Call Orsinger Investment Group, Inc. at (724) 588-9067 to discuss your POA needs.