What Is a Durable Power of Attorney?
A durable power of attorney (POA) is a legal instrument that designates another responsible party to act on the behalf of the person executing the document, if they become incapacitated by illness or age, according to Nolo. Contrary to ordinary POAs, durable POAs remain in effect after a person becomes incapacitated. These can take effect immediately upon being executed, or only go into effect after mental incapacity has occurred. Additionally, once executed, POAs can be revoked at any time, provided the person is still legally competent, explains AgingCare.
The person executing a durable power of attorney is called the “principal.” The principal designates an “agent” to handle specific legal responsibilities in the event the principal becomes unable to act on their own behalf. There are two important POAs, one for health care and the other for finances, notes AgingCare.
Because POAs must be executed while one is still mentally competent, most are completed long before people expect to need them. Additionally, due to the nature of the responsibilities that come with the position, the agent designated should be someone that the principal knows well and trusts implicitly to handle their health and/or financial matters. It is also important to note that the same person does not have to be named the agent for both, and in some cases it may even be preferable to have different agents handling each one to ensure that everything is handled properly, according to Nolo.