Power of Attorney

Estate planning is essentially based on two components: plans for your healthcare decisions if you become incapacitated, and management and preservation plans for your assets. A healthcare power of attorney can be used to address the first component, but a property power of attorney can be used for the plans for your assets.

Healthcare Power of Attorney
A healthcare power of attorney, in combination with a living will and a "do not resuscitate" (DNR) order, are the three parts of your healthcare component. These three medical directives articulate your desires in the event that you are unable to speak for yourself.

Your healthcare power of attorney will designate another person to serve as your healthcare proxy. This person makes the medical decisions for you if you are unconscious or otherwise unable to make your own decisions. Their decision making power ends if you regain consciousness. When determining the person to serve as your healthcare proxy, make sure it's someone who will carry out your wishes and someone that you can trust. If you are not sure whether you have a person you can entrust with this, consider a living will instead.

Property Power of Attorney
A property power of attorney also appoints a proxy to act on your behalf. Without a designation for your own proxy, a court can appoint an agent to represent you if you become incapacitated. If you are no longer willing to manage your own financial affairs, a property power of attorney can also be appointed to handle this for you. The person you designate (or the one chosen for you, in the event that a court does so), has the right to make financial decisions for you. Some common activities for proxies include check endorsements, tax return filings, real estate management, handling business operations, or paying bills. The variety of tasks completed by a property power of attorney make it an ideal solution for a wide range of people.

Since an agent can have so much opportunity with your financial affairs, determining your proxy is a decision that should be considered seriously, especially if you want your property managed responsibly and to continue to provide you income. Your property power of attorney should also provide details about what exact actions your proxy is entitled to complete on your behalf. This person is only eligible to manage your assets while you are alive. After that point, the property power of attorney loses any authority over those assets.

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