To most people, the process of estate planning only involves decisions about what will happen to their assets when they pass on. However, you can also use an estate plan to address your needs and wishes for the remainder of your life. This can include your wishes with respect to your health and finances.
One way of ensuring that your estate plan reflects your wishes is through the power of attorney. Basically, this is an agreement in which an individual (known as the “principal”) nominates someone else (known as the “agent”) to make certain decisions on their behalf. A health care power of attorney allows your agent to make decisions regarding your medical care needs while the financial power of attorney lets your designated agent make decisions regarding finances, income and investments on your behalf.
Here are some of the reasons why you should consider including a power of attorney in your estate plan.
Make your intentions clear
Sometimes, your loved ones may be unsure about what you would have wished for regarding your medical care. The result: They might end up fighting over issues like how long you should remain on life support or other forms of care or even how your remains will be interred. With a clear power of attorney in place, you can make your intentions clear and save your loved ones from certain disagreements during those difficult moments.
Eliminate conflicts and costly legal proceedings
A health care power of attorney empowers your agent to engage your health care providers and make decisions about the treatment you wish, or do not wish, to receive. A financial power of attorney, on the other hand, allows your agent to make decisions regarding your assets and money. If the agent acts according to your wishes, they will be protected from claims of abuse or misappropriation by the other family members. This can, in turn, prevent costly legal battles.
A power of attorney is an important estate planning tool that allows you to appoint an agent to make important decisions on your behalf when you are incapacitated. These are some of the benefits you may realize by including a power of attorney in your estate plan.