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When should you start designating powers of attorney?

On Behalf of | Apr 26, 2024 | estate planning | 0 comments

Life can be unpredictable. You may not relish dwelling on the possibility of illness or incapacity. However, taking steps to prepare for such situations demonstrates foresight and helps protect your loved ones. One crucial element of this preparation is designating powers of attorney (POA). But when is the “right” time to take this step?

A POA is a legal document authorizing a trusted individual (the agent) to manage your financial affairs, healthcare decisions, or both, depending on the document’s scope. This empowers your agent to act on your behalf if you become incapacitated. The key concept here is incapacity. You must be mentally competent to create a POA; once incapacity sets in, it’s too late. So, waiting for a health crisis isn’t a wise strategy.

Key life stages for creating a POA

If you’re a young adult, you may think it’s too early to designate a POA. However, unexpected accidents or illnesses can happen at any age. Having a POA can help ensure your wishes are respected, even if you’re temporarily unable to communicate them.

Marriage often involves shared finances and assets. A POA can allow your spouse/partner to manage these if needed, potentially avoiding delays or complications.

With children, a POA becomes even more critical. It can help ensure someone you trust can make financial and healthcare decisions for your minor children if you’re incapacitated.

Significant life changes like starting a business, buying property or inheriting assets may involve complex financial situations. A POA may provide peace of mind by helping to ensure someone can manage these affairs if needed.

If you have a chronic illness or a family history of conditions that could lead to incapacity, creating a POA is essential. It empowers your agent to make informed healthcare decisions aligned with your wishes.

Creating a POA isn’t about negativity; it’s about responsible planning. By designating a trusted agent while you’re still competent, you can help ensure your wishes are respected and your affairs are managed smoothly during any period of incapacity. Don’t wait for a crisis; talk to a reliable legal team and create your POA.