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A power of attorney is a legal document that grants someone else the authority to act on your behalf. It can be very broad or limited. You can give the person power for just one task, to carry out all your affairs or only to act for you if you become incapacitated. You don’t have to give power of attorney to an actual attorney. It can go to anyone you trust such as a spouse or other family member.
There are four types of power of attorney:
Authorizes a person to handle a specific task for a limited period of time or in certain circumstances
Authorizes a person to do whatever you can do
Authorizes a person to act on your behalf even if you become incapacitated
Authorizes a person to act on your behalf only after a certain event leaves you incapacitated
The most common type used in estate and health care planning and administration is a durable power of attorney.
When you give someone power of attorney, you are giving him or her the right to access your financial accounts, sell property, cash checks, withdraw money and enter into contracts. Granting someone a power of attorney does not limit your rights; it simply gives the other person the power to act when or where you cannot.
When no power of attorney is in place, often a family member or friend is forced to seek court appointment to become a conservator and/or guardian. This can be a difficult, costly and complicated endeavor for a family member or close friend during a very emotional time. Click here for more on conservators and guardians.