What will happen if, suddenly, you are unable to speak, unable to communicate and unable to take care of the things that require your attention every day? Who will speak for you? Who will pay your bills? Do you have an agent you have identified and authorized to take care of these things?
The scenario is not that far fetched. We read headlines everyday of people who suddenly find themselves fighting for life. The lucky ones have a long convalescence, and, for some, that includes some time in a natural or induced coma. Yorkville Man Injured in Motorcycle Crash, reads the headline. The man was 49 at the time. A car failed to yield, and, in an instant, this man’s world was turned upside down. During that time, who is taking care of his business?
Although we can not predict the future, we can be prepared. Even if catastrophe suddenly occurs, we can be prepared with a Power of Attorney (POA). POA’s allow us to designate a person to act on our behalf regarding property and financial and personal and health care decisions. The person you designate as your agent, will be able to manage your affairs and make decisions for you if you are unable to do so through a power of attorney (POA).
POAs protect your financial and property interests, personal care, health and end-of-life decisions. A POA is a legal document in which you, the principal, choose an agent to act on your behalf. You can delegate authority to make decisions only in specified matters or generally to make decisions in all matters. You can select someone you trust to handle your affairs when you become incapacitated and can no longer make decisions. For couples, that is usually each other, but in the event you are both in an accident, the POA allows you to designate successors.
Two types POAs exist: a POA for property and a POA for health care. POAs allow you to appoint an agent to make property, financial, personal, and health care decisions for you throughout your lifetime, if need be, or during a time of temporary disability. The agent you designate has a responsibility to act in your best interest, and the POA eliminates the necessity of a guardianship estate. For more information, see the blog article Fiduciary Duty of Power of Attorney Agents by Kevin Drendel on May 29, 2013.
Who should you choose as an agent? An agent must be at least 18-years-old; but more importantly, your agent someone you trust to carry out your wishes even if this person disagrees with your decision. This person should also be comfortable talking with and questioning physicians or other health care providers, who would not be too upset to carry out your wishes if you became sick and who would be available and willing to carry out this role. Successor agents should be appointed in case the primary agent is not available or unwilling to act when required.
People may think that because they are married, spouses may automatically make decisions for them. Your spouse can deal with property that is jointly held by both of you; however, your spouse does not authority over property in your name alone. If you do not have a POA for property and become incapacitated, your family members will need to go to court to obtain a guardianship to gain the authority to manage your property and make healthcare decisions, unless you have a POA. The guardianship process can be long and expensive, especially if family members disagree who should be the guardian.
A POA for property may be as broad or as narrow as you would like. The Illinois Statutory Short Form Power of Attorney for Property provides for fifteen (15) categories of powers with respect to property transactions and matters, including real estate, financial institutions, retirement plan, tax, business operations, and estate. You have control over the areas your agent can handle. You may limit the powers, delegate powers, and revoke the POA at any time.
Similar to a POA for property, a POA for health care is prudent for your medical care. Even if you have a Living Will, consider creating a POA for health care. A Living Will is only effective once your condition is terminal according to your treating physician. A POA for health care is effective once the principal loses capacity or other conditions are met as set forth in the POA. If a person has Alzheimer’s and the doctor documents that the person lacks capacity to make decisions, then the agent may act under the POA for health care with respect to medical treatment. Further, the POA may control end-of-life decisions and apply in circumstances in which a Living Will does not apply.
If you do not have a POA for health care, your physician or other health care provider will ask a family member, a friend, or a surrogate to make decisions for you. The Health Care Surrogate Act provides a surrogate hierarchy, and the person chosen as a surrogate may not be your choice.
You can control your own destiny by choosing who will handle your affairs if you cannot handle them yourself. You can save your loved ones the time and money required to obtain guardianship by creating a POAs for property and health care. Your designated agent will be someone you trust to handle your financial and medical affairs because they will people you have chosen.
If you are interested in discussing powers of attorney or other estate planning matters, please contact the attorneys at Drendel & Jansons Law Group.
By Margret M. Leuthold, guest writer for the Drendel & Jansons Law Group.
Margret M. Leuthold, is an attorney licensed in Illinois. She has worked as a consultant in the state and local tax area, with a focus on property taxes, for a large accounting firm in Chicago. She has also practiced law for a small insurance defense law firm in Chicago. Margret earned her BBA from the University of Michigan and JD from Chicago-Kent College of Law. She brings knowledge and perspective gained from outside the legal and business realm to her blogs.
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For more articles on estate planning, visit the Drendel & Jansons Estate Planning Blog; for articles on Family law topics, visit the Drendel & Jansons Family Law Blog; and for articles on various topics of law, visit the main Drendel & Jansons Law Group Blog.