A financial durable power of attorney is a document that puts you in control of who will be responsible for managing your finances if you become mentally incapacitated and are unable to handle your financial affairs on your own.
Without a financial durable power of attorney in place, if you become incapacitated, no one, not even your spouse or adult children, has the legal right to have access to your financial accounts in order to provide for you and your family. Instead some family member or other responsible person would have to go into court to be appointed your guardian.
Once a guardian is appointed, your family loses control of the financial resources you have. Instead, how your assets are managed and how they’re used to provide for you and your family is ultimately left to the decision of the judge of the court that has jurisdiction over the guardian, as opposed to the decision of your family. If you remain incapacitated for the rest of your life, the courts, rather than your family, are then in control of how your assets are managed and expended for the rest of your life. That’s not a situation that anyone wants to happen.
Fortunately this issue can be easily remedied by having a durable power of attorney in place that appoints the person that you want to have control over your financial assets if you don’t have the mental capacity to exercise that control yourself. The person you appoint in the durable power of attorney has full legal authority to access your assets and provide for you and your family without the necessity of a guardian or court involvement.
What is a Health Care Power of Attorney?
A health care power of attorney is similar to a financial durable power of attorney, except that it addresses health care decisions rather than financial decisions.
A health care power of attorney is a document that allows you to appoint the person who has the legal right to make medical decisions for you, including end of life decisions, if you’re unable to do so. It is designed to keep you in control over who will make those decisions rather than those decisions being left to chance, for example, by family members with conflicting views or the courts.
What Are Advanced Health Care Directives?
The term advanced health care directive is not a legal term of art like health care power of attorney is. What the term really refers to is all of the directives that you want about health care if you can’t make decisions yourself.
One piece of an advanced health care directive is a person’s health care power of attorney.
A second part of an advanced health care directive is what’s referred to as a living will. A living will is a document in which you tell your family what your wishes are about end of life decisions so they know what you want. It is designed not only for you to make clear your wishes, but also to take the burden off your family of having to guess what you want.
The last part of an advanced health care directive is a document authorizing health care providers to release your medical information to people you want to have access to it. Health care providers would otherwise be prohibited from doing so because of a federal law that goes by the acronym HIPAA. By having this document, the people you want to make medical decisions for you will have access to all of the medical information they need to make proper decisions.
Do Most People Take Into Account Having a Plan in Case They’re Mentally Incapacitated?
Most people who have done good estate planning will have good planning in place for the event that they become incapacitated.
However, large numbers of people who die every year in this country die without even having a will, meaning that a large segment of our population has not done proper estate planning and addressed issues like mental incapacity. It is for that reason that the courts continue to be busy with actions brought for appointment of guardians, something that in many if not most cases should not have to happen.
This article was originally published by Steve Spewak on EstatePlanMO.com. It is republished here with permission.