What is durable power of attorney? A durable power of attorney allows an agent to do things on your behalf. It’s important to understand what those things are and how durable power of attorney works. Here are six facts about durable power of attorney that are important to know.
1. WHY YOU NEED A POWER OF ATTORNEY: Just so you know, you are far more likely to be disabled or incapacitated than you are to die anytime soon. So your power of attorney documents are just as important as your will. In fact, if you think about it, your power of attorney is more important to you personally than your will because you will actually be alive when your power of attorney is being acted upon. You may well be in a health care situation, hospice or under care at home while your agent acts on your behalf. So you want to have some say now on how you will be treated then. A power of attorney allows you to do this.
2. WHY NO ONE EVER IS A POWER OF ATTORNEY: First, some quick vocab so, going forward, you can show how smart you are by using the words “power of attorney” correctly. Do not go around calling yourself (or anyone) a “power of attorney.” The document is called the “power of attorney” and the person appointing the agent named in the document is called the “principal.” The person appointed to act on behalf of the agent pursuant to the power of attorney document is called the “agent.”
3. WHAT MAKES A POWER OR ATTORNEY “DURABLE”: The word “durable” comes into play because the agent is allowed to act even when the principal is incapable of acting. It continues to operate after the principal comes incapacitated.
4. WHAT HAPPENS TO YOUR POWER OF ATTORNEY WHEN YOU DIE: A power of attorney operates when you are alive. Once you die, your power of attorney document no longer functions, and your last will and testament comes into play. If you do not have a will, then the laws of intestacy come into play. Powers of attorney are for people who are alive. When the principal dies, the agent’s authority to act ends too.
5. WHY YOUR AGENT HAS A RIGHT TO ACT ON YOUR BEHALF WHEN YOU ARE NOT INCAPACITATED: Many people think that they have something that is essentially a “springing” power of attorney that does not operate until a triggering act, such as the principal’s incapacity, happens. However, the standard durable powers of attorney do not need a triggering act. They are effective and give the agent power to act immediately upon signing, even when the principal is NOT capacitated and IS able to act on his or her own behalf. The reason for this is that an agent often needs to act right away. Waiting for a doctor to determine incapacity bogs things down and causes undue delay. It is more effective to allow the agent to act right away. The main thing is to choose an agent you trust and then trust that they will use their power in your best interest.
6. WHY YOU NEED TWO POWER OF ATTORNEY DOCUMENTS: The Colorado legislature created two different documents: the medical power of attorney and the financial power of attorney. This makes sense because you may not always want the same person to serve in financial and medical decision-making roles. Frequently, a person has one someone who is good at financial decisions and another person who is good at health care decisions. So too, you may not want your doctor to go over your financial power of attorney and may not want your banker reading all about your medical decisions. Two separate documents allow you to keep these discrete areas separate.
To learn more about durable power of attorney and how to ensure that your will and power of attorney documents are properly prepared, contact Andersen Law PC at 720-922-3880 or email me at email@example.com.