Most of what you do to your estate plans will focus on asset distribution. You’ll likely name beneficiaries to inherit some or all of your assets. Furthermore, you’ll name an executor of the estate to handle will validation, asset distribution and contracting interested parties.
In other words, your estate plan’s main focus is what happens after you pass away. However, your estate plan can also include a power of attorney. To learn about what a power of attorney is, you should continue reading:
Representative on behalf of the testator
A power of attorney is a representative or agent who acts on your behalf. Typically, they come into power when the testator is incapacitated. A testator may be deemed incapacitated if they suddenly develop a mental or physical condition that puts them in a state where they can no longer care for themselves. Furthermore, a testator may be incapacitated after suffering a severe accident.
The goal of a power of attorney is to handle the testator’s finances and medical decisions. Testators typically designate one person as a general power of attorney to handle both financial and medical decisions. However, the role can be split into two.
As stated above, a power of attorney may act on behalf of the testator to manage their finances. This may involve using the testator’s savings to pay rent, debt, utilities and medical bills.
A financial power of attorney could also be used while the testator is of sound mind. What this means is that a testator could use their power of attorney to make financial purchases. This often only happens when the testator isn’t available to do so themselves, such as overseas business transactions.
A medical power of attorney would be in charge of the testator’s health. This may involve deciding whether the testator undergoes surgery, medication, treatment or therapy.
Picking the right power of attorney
As a testator, you can pick nearly anyone to be your power of attorney. Yet, there are only some people who have the trust and dedication to upholding the role. As such, you may need to learn why picking the right power of attorney is crucial for your estate plan.