New York Estate Planning & Elder Law Blog
Caregiving is about more than just tending to the physical needs of an elderly parent. If your parent is also dealing with dementia or another degenerative disease, you must also prepare to cope with effects on both the body and mind. In the event that your parent becomes incapacitated, you need to decide whether your or someone that you trust will fill the decision making role. The ability to do so comes in the form of a Power of Attorney document.
How to Make a Power of Attorney
It is vitally important that you and your parent discuss and designate a power of attorney before incapacitation occurs. A power of attorney (POA) is a formal, legally binding agreement between the person who needs it (“grantor”) and the person designated to act on the grantor’s behalf (“agent”). An experienced attorney will be able to draft a POA for you and your parent, especially if there are financial matters or assets that may complicate decision making.
While there are some POA forms available to be downloaded off of the internet, many states do not recognize them as legally binding. Some states require that the document be notarized and witnessed in the proper manner. The best place for that is in an attorney’s office or where the grantor banks.
The most important aspect of creating a POA is that the grantor must be completely competent when the agreement is made. If or when competency comes into question the legality of the POA agreement can come into question, too.
Types of POA
There are many different types of POA agreements, and most likely your parent will need to execute many, or all, of the agreements before any type of incapacity strikes. The different forms of POA include:
POA for Healthcare
This type of POA agreement is also known as a healthcare proxy. The agent is given the right to make all health care decisions for your parent when they are unable to do so. This document should be shared with your parent’s primary care doctor, and if admitted to a hospital, included in the hospital records.
Limited POA
This type of POA grants the agent limited powers and/or time to act in a specific situation. For example, a limited POA might allow the agent to sell your father’s lifelong collection of baseball cards or manage your mother’s move from her current home to an assisted living community. The limited POA expires when the task is completed or the timeframe ends, whichever comes first.
Financial POA
This type of POA grants the agent access to and management of financial accounts and resources specifically listed in the POA. Some financial POAs split up the responsibilities among multiple people, giving one individual access to accounts used for bill paying and another person management of stock and investment accounts, and so on.
Durable POA
This type of POA grants the agent the right to manage all aspects of your parent’s life and finances, and health care, when it is specified. It goes into effect when it is signed and stays in effect until your parent cancels it or dies.
Springing POA
This type of POA “springs” into place in the case of an emergency where your parent becomes incapacitated and unable to express their own opinions. When, or if, the crisis is over and your parent regains the ability to speak, the POA ceases to be in effect.