Powers of attorney are useful estate planning tools. Unlike wills, which take effect after someone dies, powers of attorney take effect while they are still alive. Incapacitation due to an accident or medical emergency can leave people incapable of managing their own affairs.
In those circumstances, powers of attorney that they already established could take effect for their protection. Powers of attorney serve to authorize a specific agent or attorney-in-fact to act on behalf of an incapacitated individual. As is true of wills, almost any adult may benefit from establishing powers of attorney. There are a few circumstances in which the need for such documents is higher than usual.
Why do people sometimes need to plan to access support in an emergency?
1. Lacking the support of a spouse
Legal professionals often recommend that young adults draft powers of attorney shortly after they turn 18. They make this recommendation because a young adult’s parents lose the authority to provide direct medical and financial support once a teenager becomes an adult. Adults without a spouse have no one with the legal authority to access their financial accounts or make medical decisions on their behalf. Powers of attorney allow individuals other than spouses to step up in an emergency scenario.
2. Having sole authority over critical matters
Perhaps an individual is a single parent. They may need someone to manage their household and care for their children until they recover in an emergency. Maybe they are a small business owner whose company could be at risk of failing if they are not there to pay invoices and provide client services.
Powers of attorney allow people to make arrangements for the fulfillment of their personal obligations when they are not in a position to handle those matters.
3. Preparing for retirement
People thinking about what happens as they age often have to plan for every possible challenge, including permanent incapacitation. The inclusion of durable powers of attorney in an estate plan to protect the principal drafting the documents from involuntary guardianships or conservatorships. Without durable powers of attorney designating a specific agent, an individual could end up with their finances or daily affairs managed by whoever seeks that authority in court.
Drafting powers of attorney and keeping them updated can protect people in a variety of challenging situations. The right estate planning documents limit people’s vulnerability and help them feel more confident as they navigate the hazards of daily life.