When we think of estate documents, we tend to think about wills and trusts. We want our loved ones to get as much of an estate as possible — without creditors, or the IRS, taking a huge chunk out of what we intend to leave for them.
Using Powers of Attorney
We do not often think of estate documents that come in to play before we pass away. However, there are vital documents that can ensure your personal or business affairs are taken care of in the event you are permanently or temporarily incapacitated.
A power of attorney is a document that can be as broad or specific as you like. It specifies how vital areas of your affairs will be handled in case you are incapacitated.
A medical power of attorney designates a person to make medical decisions for you. They speak with doctors, and generally act as your health care surrogate. For those who are unmarried, this can be a vital document. Physicians may refuse to communicate with significant others without proof of legal marriage. Even if they do communicate with your loved ones, that does not mean that they will take their recommendations on decisions about your health care.
Document is Flexible
You can revoke a power of attorney at any time, so there is no need to worry about permanency. If you name a spouse as your power of attorney and are then divorced, it is automatically revoked.
Executing a general power of attorney allows the designee to make all decisions about your affairs (including business matters). A healthcare/medical power of attorney is more limited in scope. You can also opt to include how end of life decisions will be made — that is, how and when you do not want to be resuscitated or to have your life prolonged.
You can also require that your designee make every effort to communicate with you before making decisions on your behalf, in the event that you are unable to speak, but can still communicate in other ways.
Make Sure Your Document is Right for You
You should be wary about using DIY online templates, as they may be too broad. You may want one person to make medical decisions and another to make financial decisions. Powers of attorney that are too broad can put a lot of power over your affairs in one person’s hands.
There is some overlap between a power of attorney and a living will. A living will is a prior written designation of medical care (or refusal thereof) in an end-of-life situation. A power of attorney makes that specification, but generally allows your designee to make decisions in your best interest without being bound by your express prior wishes.
Questions about Colorato estate or probate laws? Contact Ball & Barry for help or with questions about estate or probate law matters.