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One such detail for many people is creating a power of attorney.

What Is a Power of Attorney?

A power of attorney, or POA, is a legal form. It gives someone else legal authority to make decisions on your behalf. Typically, a power of attorney form must name an agent — the person being invested with legal power on your behalf — and specify what power they have.

Types of Power of Attorney

You can choose from different types of POA forms to meet your needs, including:

• General POA. A general power of attorney is broad, granting the agent the power to make decisions and take actions on your behalf across a variety of legal and financial matters. You may want to avoid too general a POA if you want to limit the control someone else has.
• Durable POA. A durable POA remains in effect even if you become incapacitated. It's important to ensure your POA has language that makes it durable if you intend to have a trusted person act on your behalf should you become incapacitated mentally or physically.
• Limited POA. Also sometimes called a Special POA, this form grants a very specific power. For example, you might grant an adult child POA status specifically to manage the sale of your home. Once the sale is complete, the POA is no longer enforceable.
• Springing POA. This type of POA becomes effective after a specific event occurs. For example, you might have a springing POA that allows your agent to manage your affairs whenever you leave the country. It springs into effect when you travel outside the United States.
• Financial POA. A financial power of attorney refers to a POA form that grants financial powers, such as the ability to pay bills, invest money or manage accounts.
• Medical POA. A medical power of attorney refers to a POA form that gives someone the ability to make medical decisions on your behalf.

Most POA forms fall into one or more of the above categories. For example, you can have a durable springing medical power of attorney. It gives someone the legal authority to make medical decisions on your behalf if incapacitated.

Do Older Adults Need a POA?

At minimum, it's typically a good idea for adults of any age to have a medical power of attorney. A medical POA ensures the person you trust can make health care decisions on your behalf if you can't do so for yourself. Without any medical POA, your loved one may not be able to make certain decisions on your behalf.

Whether you need another type of POA depends on your personal preferences and circumstances. It can be helpful to have a POA that provides a trusted loved one with the ability to help you manage your finances, for instance, especially if you'd like them to be able to invest money or pay bills for you.

Tips for Choosing an Agent

If you decide a POA is right for you, you'll need to choose an agent. Here are some tips for doing so:

• Choose someone you trust. Select a person you trust to act according to your wishes and in your best interests. If you can't think of someone in your life you can trust, you can name a professional, such as a lawyer or an accountant, as a POA. Some restrictions exist, and you must pay professionals for their services.
• Talk to the person about the responsibility. Discuss your intent to name someone as your agent with them before completing the paperwork. Such designations tend to be more successful when the person knows they were named and agrees to it beforehand.
• Select someone with the right skills. Consider what your agent may need to accomplish and choose someone with the right skills and personality. For example, you may not want to name someone as a financial POA if they struggle with their own finances. You might also want to avoid naming someone as the agent on a medical POA if they have a hard time considering medical decisions.

Once you choose an agent and they agree to be named, take some time to communicate your needs and preferences to them. You can do this via a face-to-face conversation, but it's also a good idea to put your wishes in writing. Your agent can then reference the written document if they forget what you told them or as a backup for peace of mind during a difficult time.

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