This article was originally shared on A Place For Mom
As your parents age, it can become a struggle to respect their autonomy and independence while making sure you take all the right steps to keep them protected for the future. It’s a phase in life that comes with some difficult decisions that you and your family will have to make together. One of those decisions is setting up a power of attorney.
A power of attorney is a legal designation you can provide to another individual to act as your representative in business, financial and health decisions that would otherwise require your explicit input.
It’s one of the most important documents that a senior should have in order, but it’s one that a lot of seniors and their families don’t have prepared.
Fortunately, setting up a power of attorney is fairly simple and can save your family a lot of time and trouble down the line. It’s an important step to take sooner rather than later, even if your parent is still in good health and still has a sound mind.
A power of attorney gives a chosen family member or loved one the ability to step in and make decisions that need to be made at moments when a parent or senior either can’t do so themselves or would rather not have to.
There are a lot of scenarios where it’s convenient for seniors to have a power of attorney and others where it’s crucial.
Some examples include:
In short, if there’s any reason at all that a senior may benefit from someone else having the legal status to help make important decisions and manage their responsibilities, then setting up a power of attorney is in order.
There are a few different types of power of attorney that you should be aware of to make sure your parent covers all of their bases:
A durable power of attorney goes into effect the moment it’s signed and stays that way until either the person makes moves to revoke it or passes away. “Aging parents or parents with significant health issues should have a durable financial Power of Attorney,” recommends Somita Basu, Esq. at Norton Basu, LLP.
If a power of attorney isn’t durable, the document could lose its power the moment your parent becomes mentally incapacitated or fail to go into effect at the time they most need it. If dementia is a concern, then that’s probably the opposite of what you want.
A financial power of attorney grants someone the legal authority to handle financial matters on the principal’s behalf. That could include simple tasks like depositing social security checks or paying the person’s bills, or it could broadly give them control over managing their investments, maintaining or selling their assets and accessing their bank accounts.
Most seniors will want to provide broad powers to their agent when setting up a financial power of attorney so they can be sure that all of their financial assets and responsibilities will be taken care of if or when they lose the ability to manage them well themselves.
This one can go by multiple names, according to Basu: “also referred to in California as an Advanced Health Care Directive or, in other states, a living will, this document directs your agent to provide guidance to your doctors about your desires for care when you are incapacitated.”
A medical power of attorney gives a senior the chance to discuss their wishes in advance with loved ones, feel confident that they’ll make the best decisions for their well being when the time comes and know that those decisions will have to be respected. All seniors should plan on granting someone they trust a medical power of attorney.
A springing power of attorney is one a person can set up now, but specify that it won’t go into effect until something specific happens – usually a medical declaration of incapacity. For someone who wants to maintain power over their lives until the last possible moment, this may be tempting, but keep in mind that for aging seniors the mind doesn’t go all at once.
Usually, there’s a long period of things becoming more confusing before they reach the point where a doctor would deem them unfit. In other words, your parent will be better protected if they start with a durable power of attorney and choose someone they trust from the get-go.
A lot of seniors may feel uncomfortable with the idea of granting a power of attorney if they feel like it means giving too much power over to someone else. It’s true that a power of attorney can grant the agent they choose a lot of power, but it’s a common misconception that granting power of attorney gives someone total control over their health and money.
A Place for Mom’s legal expert, Stuart Furman, Esq. and author of “The ElderCare Ready Book” explains, “The fiduciary obligation is an aggressive restriction placed on the agent under a power of attorney to protect the principal.”
In other words, anyone a senior grants power of attorney to is legally obligated to act in their best interests. Even after they give someone power of attorney, they’ll still have access to their own assets and still be the first person doctors talk to about health decisions.
A financial power of attorney means someone else will also have the right to access their finances and make financial decisions along with them. A medical power of attorney means a parent or senior’s voice will be respected during medical emergencies when the senior is unable to make decisions and speak for themselves. It doesn’t remove a senior’s rights so much as give them the power to decide who else has a say.
The short answer is: before they need it. The sooner you sit down to discuss a power of attorney and get it set up, the better. That becomes even more so the case if your parent receives a concerning diagnosis.
Dr. Kimberly Miller, Director of Healthy Mind Sacramento says, “As a neuropsychologist, I recommend to my patients diagnosed with early dementia that they consider setting up a power of attorney soon after initial diagnosis, prior to their condition worsening.”
This is a situation where you want your parent to be able to make informed decisions while they still have the mental capacity to do so. If you wait too long and your parent is determined no longer competent to make their own decisions, you’ll be stuck going through a complicated and expensive court process to set up a conservatorship or guardianship.
Power of attorney is a much simpler process and one your loved one has more control over. It really is better to get it done long before you need it.
“We find that choosing the right agents is normally the part of the process that takes the longest amount of time,” Somita shares. “Which is as it should be, as choosing the right agent is extremely important.”
In some families, the question of who the best person to trust for finances or medical issues may be obvious. If a senior has two children and one’s an accountant and the other’s a doctor and they’re both trustworthy, then this step may be a breeze. For most families though, the decision will probably be more complicated than that.
There are a few main things you’ll want to consider when choosing the right agent:
Once your parents have decided who they want their agent to be and what powers they want to grant them, the hard part is done. Now you simply need to meet with a lawyer to have them draw up the paperwork.
You can find power of attorney documents online that are valid, but it’s better to work directly with an actual lawyer. That way you can make sure the document is up to date and reflects the specific desires of your parent.
The document must be signed with witnesses present and notarized. You should make sure that both your parent and the agents that they’ve chosen all keep a copy somewhere safe.
If your parent changes their mind about who they’d prefer to act as their power of attorney, they have options.
“To change the agents on your power of attorney, you will have to draft a completely new power of attorney document and have it notarized,” says Somita. “The old document should be destroyed.”
Your parent can make the decision to revoke a power of attorney at any time up to the point of being determined medically incapable. Once a doctor makes that determination, the current power of attorney will stay in effect for the rest of their life.
If someone with dementia tries to make a change even before they’ve been deemed incapable, they’ll still face an uphill battle.
“Generally, if a person with dementia goes to an attorney and tries to change legal documents or create new legal documents, most attorneys will require that the person have an examination by a doctor to see if they have the capacity to enter into a contract,” says Dr. Miller.
Have your parents already set up a power of attorney? What questions do you have about the process that were not covered in our “Power of Attorney Guide?” We’d like to hear from you in the comments below.
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