There are two main types of power of attorney: financial power of attorney and medical power of attorney. Financial power of attorney gives someone the ability to make financial decisions for another person, while medical power of attorney focuses on medical decisions, the American Bar Association states.Continue Reading
Financial power of attorney appoints someone to act on a person's behalf in personal, business and financial matters, as the Ohio State Bar Association explains. A person has the ability to name one person, or he can name multiple individuals who can make decisions individually or together. Financial power of attorney comes into play when a person is mentally incapacitated and can no longer manage his own affairs. An example of this is a financial power of attorney taking over for someone who has advanced dementia.
Medical power of attorney is similar to financial power of attorney in that it gives another person the ability to act on someone's behalf in regard to medical decisions, according to the South Carolina Lieutenant Governor's Office on Aging. However, medical power of attorney can be used in the event a person is incapacitated such as in a surgical procedure. The power of attorney is called on to make any decisions regarding treatment or complications. Medical power of attorney also gives someone the ability to make medical decisions for a person who has become mentally incapacitated.
It is important to remember that the exact abilities and requirements for a power of attorney can vary by state law, as stated by the American Bar Association. However, power of attorney is accepted in all 50 states and gives a designated person the power to act on behalf of another person. In some states, documentation showing that a person has power of attorney may be required. Power of attorney can also be revoked, and most states require this to be done in writing.Learn more about Financial Planning