A Power of Attorney (POA) is an essential estate planning tool that gives someone else the authority to act on your behalf in financial, legal, or health-related matters. Having a Power of Attorney in place ensures that if you become unable to manage your affairs, a trusted person can step in and make decisions for you. But why is it important, and how does it work? Let’s break it down.
Why Do You Need a Power of Attorney?
A Power of Attorney protects your interests by ensuring that someone you trust can step in and manage your affairs if you’re unable to do so due to illness, injury, or incapacity. Without a POA, your loved ones might need to go through a lengthy and expensive court process to gain control of your finances or medical decisions.
In Missouri, there is no established legal hierarchy of family members or friends who are automatically designated to make healthcare decisions for an incapacitated patient. In this situation, healthcare providers may rely on input from family members or other individuals that have insight into the patient’s goals/wishes, but there is no formal ranking to guide the decision-making process, allowing for potential conflict and delays during a difficult time.
- Key Reasons to Have a POA:
- Incapacity Planning: If you’re ever incapacitated by a medical condition or accident, a Durable Power of Attorney ensures that your agent can manage your finances, pay bills, and make medical decisions without delay.
- Avoid Court-Appointed Guardianship: Without a POA, your family might need to seek a court-appointed guardian to handle your affairs. This process can be time-consuming, costly, and may result in someone being chosen whom you wouldn’t have picked yourself.
- Efficient Financial Management: Even if you’re traveling abroad or temporarily unable to manage your finances, a General POA allows your agent to step in and handle important financial matters.
- Healthcare Decisions: A Healthcare POA ensures that your medical treatment preferences are respected if you’re unable to communicate them. Your agent can advocate for your wishes with doctors and hospitals.
What are the types of Power of Attorney?
A Power of Attorney is a legal document that grants another person (your “agent” or “attorney-in-fact”) the authority to make decisions on your behalf. The scope of this authority can vary depending on the type of POA you create.
- Our Power of Attorney:
- General Durable Power of Attorney – At Modern Law – Our power of attorney is more than your typical boiler-plate statutory power of attorney. We continue to add onto our power of attorney as new laws are released – so that our power of attorney is sure to address every possible necessity.
- Healthcare Power of Attorney – Our Power of Attorney for healthcare contains the essentials to cover your healthcare needs. In addition, we can add custom language as necessary to meet your specifics needs, including religious concerns such as jevoah’s witnesses.
When Should You Create a Power of Attorney?
It’s important to establish a Power of Attorney before you need one. You should have a Power of Attorney established when you hit life milestones. When you turn 18 and move out of the family home, when you get married, when you have a child. Ensuring you have a legally effective Power of Attorney in place is one of the most important estate planning measures in early years.
- Consider setting up a POA if:
- You have reached life milestones – 18, marriage, children, retirement, etc.
- You’re planning for the possibility of future incapacity.
- You’re facing a medical procedure or condition that could affect your ability to manage your own affairs.
- You want to ensure that your financial and healthcare decisions are managed by someone you trust in the event of an emergency.
- You are a business owner or have substantial assets.
Choosing the Right Agent
Selecting the right agent for your Power of Attorney is crucial. This person will have significant control over your affairs, so it’s important to choose someone who is trustworthy, responsible, and capable of making sound decisions.
- Questions to Ask:
- Does the person understand your financial situation or medical preferences?
- Will they act in your best interests?
- Are they willing and able to take on the responsibility?
Conclusion: Don’t Wait to Establish a Power of Attorney
A Power of Attorney is a simple but powerful way to protect yourself and ensure that your affairs are managed according to your wishes. Without it, your loved ones could face legal obstacles and unnecessary costs if they need to manage your financial or healthcare decisions.
At Modern Law, we can help you set up a Power of Attorney as part of a comprehensive estate plan. Contact us at 417-200-2500 or visit our offices in Joplin or Springfield, Missouri to get started today.
Written by Jacob Adamson
Jacob Adamson, an experienced estate planning attorney at Modern Business & Estate Planning Law, LLC, works with individuals plan for their future with practical, personalized estate planning solutions