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4 Misconceptions About a Power of Attorney (POA) Document

4 Misconceptions About a Power of Attorney (POA) Document

<!–[CDATA[Do you know what a Power of Attorney document is? What it can and can’t do?
Many people, especially caregivers of older adults, have misconceptions about this powerful legal document. Let’s take a few minutes to sort it out.

***Note: The contents of this article are to be used for informational purposes only, and should not be considered as legal advice. Please contact your attorney to obtain specific advice on your personal situation.***

Power of Attorney Misconception #1:  A durable Power of Attorney is the same as any Power of Attorney document.

A Power of Attorney is legal paperwork that permits someone to act on your behalf. A POA is usually limited to a specific matter. For instance, if you’re an investor selling a home in a different state and you can’t attend the real estate closing, you can give someone else Power of Attorney to sign the paperwork for the sale. A regular POA ends when the purpose is fulfilled. Additionally, if you should die or become incapacitated, the POA ends.

A durable Power of Attorney must be put into place before you need it. It gives someone the right to act on your behalf for specific purposes even if you should become incapacitated or unable to make decisions on your own. Should you regain your health and judgment, the durable POA would end.

In dealing with elder law matters, people often use “POA” when they mean “durable POA.”

Power of Attorney Misconception #2: A single durable POA covers all of your affairs and dealings should you become incapacitated. 

You can give someone a POA for your health care, giving that person (the agent) the right to make decisions about your medical treatments. A durable POA for healthcare is sometimes called a health care proxy. You can give that same person, or someone else, POA over your finances. But a single POA will not cover all your decisions.

Power of Attorney Misconception #3: A durable POA will survive your death.

Any POA ends if the person dies. The person who will manage your estate after your death would be specified in a last will and testament as your executrix. This could be—but doesn’t have to be—the same person who acted as your health care proxy or the agent of your financial POA.

Power of Attorney Misconception #4: The agent under a POA can make whatever decisions they want.

Whether you’ve granted the agent a POA or a durable POA for finances or healthcare, your best interests are protected by something called a “fiduciary obligation.” This term means that the agent has an overriding obligation to always do what’s best for you.

You may have even specified certain decisions, such as choosing an assisted living facility, and outlined these choices in the POA prior to becoming incapacitated. In this situation, the agent is merely carrying out your wishes because you are unable to do so by yourself.  

Get the Legal Help You Need

It is usually best to speak to an attorney to create a durable power of attorney for healthcare and finances in place before you need them.

When an aging loved one is preparing to move to a senior living community, it’s good to take time to discuss durable POAs and your loved one’s wishes for their health and finances in the future.

Five Star Senior Living’s Resources for Families provides a host of information to help you with financial planning and elder law issues.

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