Choosing the Right Power of Attorney

Choosing a power of attorney (POA) is one of the most significant decisions you can make when planning for the future. A power of attorney is a trusted individual (or individuals) who can make important decisions on your behalf should you become incapacitated or otherwise unable to handle your affairs. The right choice requires careful consideration, as it entails significant responsibility and legal authority over your financial and health matters.

The Power of Attorney’s Role
A POA can be appointed for different aspects of your life. The two primary types of POAs are:

• Health Care Power of Attorney – This person makes medical decisions on your behalf, ensuring that your healthcare preferences and treatment plans are followed.
• Financial Power of Attorney – This person manages financial affairs such as paying bills, handling investments, and overseeing real estate transactions.

You may choose to designate one person for both roles or appoint two separate individuals, depending on their strengths and expertise. Regardless, the role comes with great responsibility, and it is not a decision to be taken lightly.

Key Considerations
When selecting a POA, several crucial factors should be taken into account:

• Proximity and Accessibility
  Having a local POA can be highly beneficial. The closer they are, the easier it will be for them to handle legal matters, attend meetings, or respond quickly to emergencies. A POA who lives far away might face logistical challenges in managing affairs promptly.
• Age and Longevity
  Choosing someone younger or at least in good health is a practical consideration. Your POA should be someone who is likely to be available and capable of serving in the role for the foreseeable future. While age alone is not a determinant, an older POA might eventually face their own health challenges, which could impact their ability to act on your behalf.
• Time and Availability
  Serving as a POA is a demanding role that requires time and commitment. Some people, due to career demands, family responsibilities, or personal constraints, may not have the bandwidth to take on this responsibility effectively. It is essential to choose someone who has the time and willingness to fulfill the role.
• The POA’s Decision-Making Skills
  Your POA should be someone who remains calm under pressure and can make sound decisions, especially in stressful situations. If they will be your Health Care POA, they must be able to advocate for your wishes in medical settings, even when faced with emotional challenges. Similarly, a Financial POA should be level-headed, responsible, and capable of managing money prudently.
• Financial and Legal Acumen
  A Financial POA should be comfortable handling money, managing investments, and making financial decisions in line with your best interests. If they lack expertise in these areas, they should at least have the wisdom to seek professional guidance when necessary.

Introducing Your POA to Your Financial Advisor
Once you have chosen your POA, it is a wise step to introduce them to your financial advisor. This ensures that your POA is not stepping into the role blindly should they need to take action. A financial advisor can provide insight into your accounts, financial plan, and investment strategy, helping the POA make informed decisions. Additionally, establishing a relationship with your financial advisor beforehand can make the transition smoother if the POA ever needs to step in.

Discussing and Documenting Your Wishes
It is crucial to have open and honest discussions with your chosen POA about your expectations and wishes. Whether it’s your preferences for medical treatment, financial priorities, or specific directives regarding asset management, providing clear instructions ensures that your wishes are honored. Legal documentation, such as a living will or advance directive, can provide additional clarity and support.

Consider Naming a Backup POA
Life is unpredictable, and circumstances may change. Your chosen POA may no longer be available or willing to serve when the time comes. Naming a contingent or backup POA is a smart move to ensure continuity in decision-making if your primary choice cannot fulfill the role.

Selecting the right power of attorney is a critical decision that requires thoughtful consideration. The individual(s) you choose should be trustworthy, responsible, and capable of handling the duties required. Whether you appoint one person or divide responsibilities between a Health Care POA and a Financial POA, your choice should be well-informed and discussed openly. Furthermore, introducing your POA to your financial advisor can help ensure a seamless transition when the time comes.

By taking these steps, you can have peace of mind knowing that your affairs will be managed according to your wishes, even if you are unable to make decisions yourself.

This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.