When you grant someone power of attorney, you are placing your life in that person’s hands. Considering the enormity of this decision, we highly recommend that you take your time to ensure that you choose the right person for the job: someone trustworthy who understands the duties involved and will act in your best interest. In addition, you may choose to grant them a specific type of power of attorney to limit their power or give them certain rights. You’ll find that there are four main types of power of attorney:
Types of Power of Attorney
GENERAL
A general power of attorney gives someone complete and comprehensive control over all of your personal and financial decisions. They will have all the rights and powers that you have. Thus, they can sign documents on your behalf, withdraw money from your bank account, pay your bills, invest your money, file your taxes, and much, much more. The document becomes void upon the creator’s death or incapacitation, but the creator may also rescind it before these events occur.
LIMITED
A limited power of attorney, as you might have guessed, gives someone very limited power for a specific purpose. The person’s rights are detailed in the document, and the time limit is specified as well. For example, you might use a limited power of attorney to give someone the right to sign a document on your behalf while you are out of the country.
DURABLE
Unlike a general or limited power of attorney, a durable power of attorney remains in effect after the creator becomes incapacitated. This is its primary purpose, and it can be general or limited in scope. Most attorneys recommend that all people create a durable power of attorney within their estate plan, just in case they someday become incapacitated. The document remains in effect until the creator’s death, but they may rescind it before then.
SPRINGING
A springing power of attorney “springs” into effect if the creator becomes incapacitated (unlike a durable power of attorney, which is in effect before incapacitation). If you choose to use this type, be sure to carefully specify the standard for determining incapacity within the document. How and when should it be used? This will ensure that your springing power of attorney is only triggered at the appropriate time, not before and not after. In addition, please note that some states do not allow for a springing power of attorney.
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When creating your estate plan, you must be very clear regarding whom you have granted the power of attorney, the extent or limit of their power, and when that power will take effect. To ensure that you form the document correctly, work with an experienced estate planning lawyer in Springfield MO. With their guidance, you can create a plan that thoroughly describes your wishes and guarantees that they will be followed.