Over the course of a person’s life, they have to make decisions about their future, one being who will be their power of attorney (POA) if the time comes. According to the American Bar Association, a power of attorney is one or more people who can act on a person’s (the principal) behalf as their agent. It is a signed legal document giving the person, a trusted family member or associate, authority to participate in the person’s financial and/or medical matters. One of the purposes of having a power of attorney allows for the person’s decisions to continue to be made if they are unable to do so. However, a power of attorney has multiple obligations to follow when acting on behalf of someone. If you are in this position for a loved one, keep in mind the responsibilities below.
Healthcare Power of Attorney
- Decisions for the healthcare POA can sometimes be dependent on the financial POA. However, the healthcare’s main responsibilities are to help with deciding what medical care the principal receives, such as hospital care, treatment, and therapy, as well as which doctors and care providers the principal can use. You are expected to uphold the principal’s wishes and can be called the healthcare proxy or healthcare surrogate.
- The agent also participates in determining the lifestyle of the principal, if the principal is unable to live by or take care of themselves. The agent will assist in settling the residential care, whether it is in an assisted living facility, nursing home, etc. In addition, they’ll look at who will come in during the day and night to provide help with everyday tasks.
Financial Power of Attorney
- While you will be working with the healthcare POA, the financial agent has separate duties, such as accessing the principal’s finances to pay bills, housing needs, and healthcare.
- The financial POA will also file taxes and make investment decisions on the principal’s behalf.
- Lastly, they’ll collect debt, manage property, and apply for public benefits.
Tips to Remember for Both
- A POA’s authority can be effective when the legal document is signed or the POA can be set to a “springing” POA, meaning their actions take effect at a certain time or event.
- Be aware of what duties are given to you. Some examples include signing documents for transactions, completing banking actions, making donations, etc.
- Keep records of all the duties you perform for the principal. If for any reason the principal or court asks for the records, you’ll be able to provide them.
- Understand your rights as an agent. Read all the documents and information given regarding a decision before finalizing or signing. Also, understand your obligations once the principal passes away and what you will still be responsible for.
What an Agent Cannot Do
- Change the principal’s will.
- Continue to make decisions after the principal’s death, unless the agent is named the executor of the person’s will; or if there is no will, the agent can petition to become the administrator of their estate.
- Transfer the POA to another agent. A current POA can decline their responsibilities; however, she cannot choose someone else for her position.
- All actions should be in the best interest of the principal.
The Power of Attorney is a helpful position, but one that comes with great responsibilities. Most of the time, siblings, spouses, or children will become a person’s agent. If you are a POA or know someone who is, be sure you know your responsibilities and limitations, all while acting in the principal’s best interest.