As parents grow older, it becomes increasingly important to plan for their future care and well-being. One useful tool in this planning process is a power of attorney (POA).
POAs can ensure that aging parents receive the care and support they need, even if they become unable to make decisions for themselves. Also, families can avoid potential legal complications and ensure that they fulfill their parents’ wishes.
Types of powers of attorney
There are a few types of POAs available, each serving different purposes:
- General power of attorney: This grants broad authority to the agent to handle various financial and legal matters on behalf of the parent. However, it becomes invalid if the parent becomes incapacitated.
- Durable power of attorney: This type remains in effect even if the parent becomes incapacitated, making it particularly useful for long-term planning. It can cover both financial and healthcare decisions.
- Limited power of attorney: This grants specific powers for particular tasks or a limited time period. For example, it may be necessary to allow a family member to manage a real estate transaction.
Effective estate planning typically includes a durable POA at the least. Assigning this authority requires filling out an official form that specifies the agent’s powers.
Benefits of establishing a power of attorney
Setting up a POA for aging parents offers several advantages. For starters, this action ensures that a trusted person can manage a parent’s affairs if they become unable to do so.
It also helps avoid the need for costly and time-consuming guardianship proceedings in court. Another important aspect is that POAs allow parents to specify their wishes regarding financial and healthcare decisions in advance.
The outcome of establishing a POA is offering peace of mind for both parents and adult children, knowing that there’s a plan in place. Beyond that, the family can avoid disputes by clearly outlining who has decision-making authority.
By establishing a power of attorney, families can better prepare for the challenges that may arise as parents age. While it may be uncomfortable to discuss, having these conversations and putting a POA in place can ultimately lead to smoother transitions and better care for these loved ones.