Posted on: 6 September 2017
During your estate planning, you will have to decide which documents are necessary in helping your executor and other trusted agents make decisions about your financial and personal matters. One of those documents is a power of attorney. There are several types of powers of attorney, but most people must choose between a limited or general. If you are unsure which is for you, here is what you need to know.
Do You Need a Limited Power of Attorney?
A limited power of attorney restricts the authority that you place in an agent to handle only certain affairs. For instance, you can grant authority to an agent to make decisions solely about your medical care. He or she would not have any say in other matters, including your financial matters.
You could even decide to restrict the agent's authority even further. Instead of granting him or her the authority needed to make all medical decisions, he or she could be restricted to determining which medical care providers treat you, but have no say in whether lifesaving measures should be taken if you are in a certain condition. That decision could be left to someone else.
A limited power of attorney can have an expiration date. For instance, you can choose to allow someone to act as an agent who is responsible for paying your bills for one year. Or you could have the power of attorney expire after someone completes a business transaction, such as selling a store.
You should consider using a limited power of attorney if you want to restrict the power that someone has in your affairs. Any matters that are not handled by through the limited document could be covered by the general.
Is a General Power of Attorney Right for You?
A general power of attorney is broader than the limited document. Instead of being limited in authority to specific areas, the general document would give an agent more power to oversee your financial, health, and other matters. The general document rarely expires.
You should consider using a general power of attorney if you want to ensure that all your affairs are taken care of if you are incapacitated and incapable of acting on your own behalf. It provides protection in emergency situations in which your inability to handle your own affairs was unexpected.
For instance, if you are injured in a car accident, the agent would have the ability to pay bills, run your business, and make health care decisions for you. Any duties that you assigned under a limited power of attorney would be handled by the agent listed in that document.
Talk to your attorney, someone from a place like Klotz Jean Law Office Of, to determine the right power of attorney for your estate planning.Share