A power of attorney document provides you with a sense of security in uncertain times by making it possible for someone to step into your shoes and carry out certain functions essential to your life when you aren’t able to handle them yourself.
However, there are several different types of powers of attorney that you may find useful, including:
This type of document allows you to appoint a representative who can act on your behalf only if you become incapacitated sometime in the future. The person you appoint will have no authority until that point. They can be somewhat complicated to create because it has to be very clear what exactly “incapacitated” means and how long you must be in that condition — or are expected to remain in that condition — before they go into effect.
This document lets you direct someone else to act on your behalf for a specific purpose — and only that specific purpose. For example, someone in the military might empower their agent to manage their apartment while they are deployed overseas.
This kind of document is broader in nature than the previous two that have been discussed. It empowers the person you have chosen to act on your behalf in any financial manner, including banking, house-selling, bill-paying and more. The authority ends, however, if you become incapacitated or die.
This document prevents you from being in a sort of legal limbo if you become incapacitated. With it, your attorney-in-fact can act on your behalf to direct your affairs until your death. It is often used in conjunction with a living will to manage end-of-life decisions.
As you develop your estate plan, it’s important to give some thought to these types of documents. They often enable people to overcome emergency situations with relative ease, so don’t overlook their value.