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What Is a Power of Attorney?
A power of attorney (“POA”) is a legal document that you can use to let another trusted person make decisions on your behalf when you cannot make those decisions for yourself. Under a POA for yourself, you are called the “principal” and the person you are giving the power to is called your “agent.” There are many kinds of POAs and they can be used for many scenarios, both specific or very broad. For example, you can give someone a POA to perform a very specific task only. You can also have a broad POA, where the most common POA is called a “durable POA.” A durable POA will kick in when you, the principal, are unable to act on your own behalf.
What Is the Purpose of a General POA?
The purpose of a general POA is to make sure that a trusted person is ready to help you if for whatever reason you become unable to make decisions for yourself due to illness or injury. The POA can be changed to give the agent whatever specific powers you feel are necessary. However, the standard POA will give your agent to power to do most or all of the following:
- Handling financial and business transactions.
- Buying life insurance.
- Settling claims.
- Operating business interests.
- Make medical decisions for you.
- Making gifts.
- Employing professional help.
In a general POA, your agent can do whatever is necessary to maintain your business and personal life in your stead. For example, if you have a health problem and are in the hospital and are unable to communicate or do anything due to the health issue, a POA will allow your agent to pay your bills, deposit money, maintain investments, and do anything necessary to make sure your assets and personal life are protected and maintained.
Best Interest of the Principal
When the person you choose becomes your agent, they have to sign a document acknowledging that they will be your agent, and that they will do everything with your best interests in mind. By law, an agent to a POA must act in the best interest of their principal, and cannot do anything that negatively affects their principal. For example, they cannot take property or money, or make risky investments on behalf of the principal. If they do something illegal or violate this rule, they can ultimately be held responsible for a breach of their duty.
Warren Wills, Trusts, and Estates Lawyers at Herold Law, P.A. Help People Get Their Financial House in Order Including Drafting a Power of Attorney
A Power of Attorney is a vital document that everyone should have, along with a last will and testament. Allow our Warren Wills, Trusts, and Estate Lawyers at Herold Law, P.A., to help you create and draft a Power of Attorney will protect your interests going into the future. We have been protecting our clients for over 40 years. Call us today at 908-647-1022 or fill out our online form for an initial consultation. Located in Warren, New Jersey, we proudly serve clients throughout Plainfield and the surrounding areas.
