When you want to give someone authority to make decisions in your place, a power of attorney is one way to proceed. This legal document gives one person, called the agent, the power to act for another person, called the principal. In the document, you describe the scope of authority you are granting your agent. Powers of attorney are intended to benefit the principal making them, so generally you are free to create as many as suit your needs.
Power of Attorney
State laws concerning how to create a power of attorney differ, but most require that the principal sign the document in the presence of a notary, witnesses or both. You can often obtain power-of-attorney forms from your local court that fulfill all your state's requirements, but forms are also available from online legal document providers, banks and law firms. Depending upon your preferences, you can use one or many different forms to set up the powers of attorney that will serve you best.
Read More: Does Power of Attorney Override a Will?
Medical or Financial
Powers of attorney confer authority to an agent to make either financial or medical decisions for the principal for a set term or indefinitely. For example, if you plan an extended vacation in a remote area, you can use a financial power of attorney to name an agent to handle your day-to-day finances for the period of the trip. Individuals typically make medical powers of attorney to ensure that someone they trust will make their medical decisions if they become incapacitated. Some states combine a medical power of attorney with a healthcare declaration, or living will, into a single form, commonly called an advance healthcare directive.
General or Limited
You can tailor a power of attorney to fit your personal needs. If you require someone to oversee all your financial affairs, you can set up a general financial power of attorney. This gives your agent broad authority to handle your finances and make any decision that you would make if available. Alternatively, you might require an agent to take over one part of your financial affairs, like selling a boat or investing your retirement funds. In that case, you draft a limited power of attorney that describes clearly and precisely the extent of the authority you're conferring.
The law does not forbid a principal from giving several different agents overlapping authority in several different powers of attorney. You are also free to name several coagents in a single power of attorney, or to prepare identical powers of attorney appointing different agents. Obviously, the risk of conferring the same authority is that disagreement among the agents will slow decision making, but the advantage is that coagents provide oversight that is otherwise lacking. The key to creating a successful agent/principal relationship is to select reliable, reasonable and organized agents in whom you have complete confidence.
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