Who are the key players in power of attorney documents?
There are two important roles. First, the principal is the person who is signing the power of attorney documents. These papers give authority to a designated agent, or attorney in fact, whose job is to act on behalf of the principal.
Who you name as an agent may be different than the executor of a will, also known as a personal representative under Arizona law, and a trustee, who administers a trust.
What types of power of attorney documents does Arizona law recognize?
In Arizona, there are three types of power of attorney documents.
A financial power of attorney, sometimes known as a general power of attorney, gives an agent power to handle the principal’s financial affairs, including:
- Paying bills,
- Managing financial and bank accounts, including pensions and retirement plans, and
- Buying, selling, or mortgaging real estate.
A health care power of attorney gives the agent authority to make medical decisions for the principal, including speaking with doctors and consenting to surgical procedures. Your health care agent will also have authority to follow directives set out in your living will, detailing how you want to spend the last days of your life and whether or not you want to “pull the plug.”
A mental health care power of attorney gives your agent, along with mental health professionals, authority to place you in a psychiatric hospital if you are a danger to yourself or others.
How do I select an agent?
Before you can sign these documents, you will need to pick out one or more agents who can act on your behalf. Often, people will choose their adult children for this role. However, when you select an agent, you should select someone who you know will carry out their duties and responsibilities honestly. When you sign these documents, you are giving authority to another person to act in your best interest.
For example, Arthur and Betty have two children, Claire and David. Claire has a Master’s in Accounting and is a CPA, while David is an entrepreneur with two failed businesses under his belt. Even though Arthur and Betty love their children equally, Claire’s education and experience make her a better fit to act as a financial agent than David, who has a history of following get rich quick schemes that usually don’t pan out.
You should also consider proximity. If one of your children lives close, and the other is across the country, it may be more practical to give authority to the one who lives down the street. After all, it’s hard to deposit checks or go to doctor’s appointments from another time zone.
I also encourage my clients to select one or more successor agents as a backup plan, in case the original agent is unable to act when the time comes.
Why do I need a power of attorney?
These documents give your designated agents the authority to care for you when you are no longer able to care for yourself. Without these documents, your loved ones would need to go to a judge and apply for court-ordered guardianship or conservatorship before they can help manage your affairs. This can be costly and time-consuming at an already stressful time.
When should I sign my power of attorney documents?
As soon as possible! As much as we want to plan our lives, you could get hit by a bus tomorrow and be in a coma. Creating your power of attorney documents now will let your designated agent care for you when the time comes.
A durable power of attorney document doesn’t expire – as long as you don’t revoke the authority, they will remain valid. It’s never too early to sign them, but it can be too late. You need to be of sound mind for these legal documents to be valid. A diagnosis of dementia or early onset Alzheimer’s could mean that it’s too late.
How do I create a power of attorney?
Set up a meeting with me and we can prepare the paperwork together. I am happy to answer all of your questions, as many times as necessary. It’s important to take these documents seriously because they will have a serious impact on the rest of your life. These documents can be signed, witnessed, and endorsed by a notary public quickly.
This article does not contain legal advice or form an attorney-client relationship. It is for general information purposes only. If you have questions about power of attorney documents or want to discuss other estate planning documents, please contact me today to set up an appointment.