Why should you have a Power of Attorney?

A power of attorney is needed to legally designate someone to make decisions on your behalf should there be a future situation where you are unable to do so for yourself.  An example would be if you were injured, had a critical illness, or were away (perhaps out of the country) and unable to manage your finances, personal affairs or healthcare.   There are two types of Power of Attorney that you will want to consider.

1. General Power of Attorney:  The appointed person can do anything and everything on your behalf.
2. Special Power of Attorney or Limited Power of Attorney:  The appointed person can only perform specific duties and actions on your behalf.

Having a POA means you have considered a contingency plan should an unforeseeable emergency happen and have put your trust in one person who will act on your behalf.   POAs can be valid only until a certain date, valid only during specific conditions, or valid in the event of a specific health emergency.

Christine’s Tip:

Remember, that POAs are not “bullet-proof.”  Banks, financial institutions, and investment firms often don’t want to accept a personal POA.  They prefer to use their own in-house forms with signatures from their clients to ensure there is no future issues.  It might be best to have joint accounts or even joint ownership of investment products for spouses, instead of relying on a power of attorney.