What Is Durable Power of Attorney?

Life can sometimes bring health changes that leave us unable to make important decisions for ourselves.

Starting a family conversation before these health changes take place can help family members make confident decisions about who will handle their affairs, says the National Cancer Institute. Planning ahead can also help family and close confidantes clarify and understand their loved ones' wishes and goals. 

Advance directives are legal documents that specify healthcare wishes and decisions—and who can make those decisionswhen we're no longer able, according to the National Caregivers Library (NCL).

A specific type of advance directive known as adurable power of attorneycan legally enable a friend, family member or trusted professional to make essential - often difficult - decisions on someone's behalf when they're incapacitated and no longer able, according to the NCL.

Adurable powerof attorney document can be crafted to specify the sorts of decisions can be made for another person. According to the Minnesota Attorney General’s Office, these can include:

  • Health care decisions, such as which medical treatments should be used or withheld. This can include treatments for acute or chronic conditions, life support or resuscitation, and end-of-life care.
  • Money-management decisions, such as managing investments and retirement accounts.
  • Managing and making gifts and donations.
  • Acting on your behalf in a court of lawor official appearances.
  • Paying your mortgage, car payment, or other financial obligations.
  • Managing Social Security, Medicare, pensions, or any other benefits to which you’re entitled.
  • Serving on your behalf for any other items you specify.

TheMinnesota Attorney General’s Office saysa person who wants to appoint someone to act on his or her behalf is knownas the “principal."He or she appoints an“agent”or “attorney-in-fact”to act on his or her behalf. This person should be a highly trusted individual—such as a spouse, adult child, lawyer, physician or close friend—who is both knowledgeable about the principal’s wishes and comfortable executingthem.

Oncea durable powerof attorney has been thoroughly discussed with family and a trusted attorney-in-fact has been chosen, the next step involves creating the agreement and defining its terms. Many state attorney generals’ websites, banks or brokerages offer sample power of attorney forms that can serve as a framework, says the Minnesota Attorney General's Office.

The NCL also recommends signing the document in front of multiple witnesses, including a doctor or a lawyer who can serve to confirm that the principal is of sound mind at the time of the document’s creation, and thus ensure its validity. Having an attorney review the document to ensure it’s completed correctly and thoroughly covers the principal’s wishes is another safeguard recommended by the NCL. Finally, the document should be stored in a safe place easily accessible by both the principal and attorney-in-fact. Storing a copy with a physician or attorney is also helpful.

As parents andolderfamily members prepare advance directives, such as a durable power of attorney, it’s good to remember that health changes can affect us all - regardless of age. Even younger family members can benefit by planning for unexpected or critical health changes. It’s never too early to plan for your future needs.

Estate planning? An Allstate Agent can help make sure your family is taken care of financially.
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Published: June 2014

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