You have probably heard of a power of attorney (POA) and are wondering how you can choose one. Basically, a power of attorney lets you appoint someone to make decisions regarding your health and finances on your behalf should you lose the capacity to do so by yourself.
As you can imagine, this is a very monumental role. The right choice of power of attorney can give you peace of mind. A misstep, on the other hand, can be your worst nightmare. For this reason, most people prefer appointing their spouses, close relatives or an attorney as their agents.
So who should you designate for this role?
Now that you understand why you need a power of attorney and potential candidates for the role, what attributes should you look for when choosing a POA? Well, here are four questions that can help you make this important decision:
- How does the person you are considering for a power of attorney relate to your loved ones? Do they have a good relationship with your spouse, children and other close relatives? And if the individual is your relative (say a spouse or a child), can you trust them to make difficult decisions like managing your finances prudently or switching off the life support?
- Does your designated agent have sound problem-solving skills? Are they able to make compromises when the need arises without sacrificing their values?
- Will the designated agent be ready to put your best interests and wishes ahead of their financial and personal beliefs?
- Is your designated agent one of your beneficiaries? Generally, putting a beneficiary in charge of important financial and healthcare decisions can lead to conflicts during the probate process.
A power of attorney is an important component of every estate planning process. Find out how you can designate a POA that will respect and implement your wishes.