What are the 4 types of Power of Attorney?
Have you recently found yourself in a situation where you need a power of attorney?
Perhaps you may not need it now, but foresee yourself needing one in the future. Whatever the case may be, a power of attorney is quite a significant piece of legal documentation that will allow a person, known as a principal, to appoint someone to act on their behalf if they become incapacitated. This person, known as the agent, is expected to work in the interest of the principal to keep the principal’s best interest in mind. For those that are seeking to appoint an agent, it is crucial that you pick someone you trust because that person will have the legal right to act for you.
Now, you might be thinking that getting one, is a relatively simple process. However, there is more to it than just picking an agent and signing some papers. Aside from selecting an agent, you will need to choose the right type of power of attorney, since each one will affect what types of decisions your chosen agent can make such as:
- Make monetary gifts
- Execute healthcare decisions that include having the power to grant, stop, or withhold medical services, treatments, or even diagnostic tests.
- Note that a health care power of attorney can be given to another individual to take over healthcare decisions.
- Make financial decisions that concern your finances
- Choose a guardian for you
There is quite a lot of power a power of attorney can bequeath to a chosen agent, so knowing the different types and what they are for should be handy in case you are ready to make a decision. Check out the types available below:
- General – An agent with a General P.O.A. is legally allowed to perform any act in place of the principal that includes actions like managing personal finances, opening bank accounts, and the like. This appointment can be terminated if the principal passes away, revokes a power of attorney, or becomes incapacitated.
- Durable – A Durable power of attorney is similar to a general power of attorney since the agent is appointed to act on behalf of the principal. However, the difference is that it maintains a clause that a power of attorney remains valid even after the principal is incapacitated.
- Limited or Special – For this specific type of power of attorney, an agent can only act on behalf of the principal on specific areas and only has certain powers. For instance, a SPA or special power of attorney can be issued to grant an agent to sell some real estate or perhaps a business.
- Springing Durable – Springing Durable power of attorney may not be available in all states. Still, essentially, a springing power of attorney becomes effective only when an event specified in the legal document occurs or when the principal is incapacitated.
As you can see, not only is choosing the right person to be an agent crucial, but choosing the correct power of attorney is equally as important. Give us a call to guide you in this process: 650.261.9791