Comprehensive estate planning not only includes getting your finances and will in order but should also include discussions on whether a power of attorney (POA) is suitable for you or your parent. Elderly parents may need assistance making both financial and medical decisions, and a power of attorney can alleviate issues stemming from cognitive decline. But how do you obtain a power of attorney, and what type is right for you?
Planning for a power of attorney can require difficult conversations. Prepare yourself by reading the following article to understand the basics of getting your parent a power of attorney that advances their wishes.
How Does a Power of Attorney Work
A power of attorney is a legal document that assigns rights and duties from your elderly parent - also known as the principal - to you or another trusted loved one. Once a power of attorney is signed, you or your parents’ loved one becomes an agent, also called the attorney-in-fact.
The agent can act on behalf of the principal, making decisions such as paying bills, managing investments, or whether to have surgery. The scope of the agent's duties and whether they can make certain choices is determined by the terms of the power of attorney and law.
Why an Elderly Person Should Get a POA
As we age, life can become more complicated, and legal matters can become increasingly challenging. A Power of Attorney can be a critical tool in ensuring an individual's wishes are honored, and their affairs are managed appropriately.
It's important for elderly individuals to weigh the many reasons supporting the decision to get a Power of Attorney:
Incapacity
A common reason for getting a Power of Attorney is to plan for incapacity. As we age, our mental and physical health can decline, and issues can arise that prevent us from managing our financial and legal affairs. With a Power of Attorney, an elderly person can choose a trusted person to manage their affairs if they become unable to do so themselves due to incapacity.
Convenience
Another reason to get a Power of Attorney is for convenience. An elderly person may have difficulty managing their affairs due to mobility issues or other health problems. A Power of Attorney can allow them to delegate specific tasks or responsibilities to someone else, making their life easier.
Avoiding Guardianship Proceedings
A well-drafted Power of Attorney can help an elderly person avoid guardianship proceedings in the event of incapacity. Guardianship can be a costly and time-consuming process that may not respect the individual's wishes or preferences. By granting a Power of Attorney before incapacity occurs, an elderly person can avoid the need for guardianship.
Financial Affairs
Managing financial affairs can become more challenging as we age. An elderly person may have multiple accounts, investments, and assets that require attention and management. With a Power of Attorney, they can delegate financial management responsibilities to a trusted person who can help them stay organized and meet their financial obligations.
Healthcare Decisions
Healthcare can be another challenging aspect of aging. An elderly person may require medical care, and decisions need to be made about their treatment. A Power of Attorney can grant healthcare decision-making authority to a trusted individual who can make healthcare decisions on the elderly person's behalf and in accordance with their wishes.
Types of POA Available
There are a variety of types of power of attorney documents available. The first choice is between a financial POA and a medical POA.
Some people may want one loved one to make medical decisions and another to handle their finances. However, remember that for the elderly, healthcare decisions can quickly become financial choices. For example, whether to receive care at home or in a managed facility often requires reviewing costs.
Another type of POA is called a springing power of attorney. These only come into force once the principal is declared incapacitated.
Finally, you may want to ensure your power of attorney is durable. This means that the arrangement remains in force even if the principal is declared incapacitated.
Rights an Agent Has With POA for Elderly Person
For the agent, the rights and limitations by POA type change. If you are an agent for a medical POA, your decision-making rights are limited to health care (and, sometimes, paying for it).
Likewise, if you are the agent for your parent’s financial power of attorney, you cannot decide whether your parent needs to see a medical specialist on their behalf. Or if they should receive care in an assisted living home instead of trying to fend for themselves at home.
How to Set up a Power of Attorney for an Elderly Parent
Sometimes, it may be difficult to get an elderly parent to agree that the time may be right for end-of-life discussions. However, having conversations about the importance of a Power of Attorney before your parent needs someone to make decisions on their behalf is essential.
You might want to try the following approach:
- Talk openly and honestly about the benefits of having a Power of Attorney: Use good communication skills and be understanding if they are initially hesitant. Emphasize the importance of having these conversations before the need arises for someone to make decisions on their behalf.
- Include a discussion as part of estate planning: Highlight that part of preparing for the future is protecting what your parent has accumulated through hard work. Explain that having a valid Power of Attorney is a crucial component of this comprehensive planning.
- Seek assistance from financial planners or estate consultants: These professionals have experience in navigating delicate conversations regarding Power of Attorney. Their guidance can provide valuable insights throughout the process.
Power of Attorney for a Parent with Dementia
Once your parent has Alzheimer's disease or any type of dementia, it will be difficult to obtain a power of attorney without consent. Unless your parent is still legally competent, they will be unable to sign a power of attorney agreement. Instead, you may need to petition a court to allow you to be appointed their conservator or guardian. However, being an agent under a power of attorney vs. guardianship has many differences.
For one, being a court-ordered conservator or guardian means that your duties are derived from a judge. Having an enforceable power of attorney means that your parent expressed their desire to have their agent make decisions on their behalf. Your parent also agreed to a certain scope of duties for the agent.
If you do not have a power of attorney in place before your parent is unable to legally make their own choices, you may face numerous fights. For one, there is no guarantee a court will appoint you to be the parent’s guardian. Since your parent can no longer clearly express their wishes, you may be faced with someone else having control of their finances and health care choices.
Create an Official Power of Attorney
FAQs About POA for Parents
-
When is the right time to set up a power of attorney for an elderly person?
There is never a wrong time to set up a POA for your parents. Usually, this should be discussed during an annual estate planning session.
-
How to get power of attorney for elderly parents revoked?
If you think your elderly parent has granted POA duties to the wrong individual, they will need to formally revoke this while still competent. They can do this by ending that arrangement through a statement or legal attestation, then possibly appointing a new agent or creating a new document.
-
How to evaluate the “capacity” of an older person?
The legal definition of capacity differs from your elderly parent simply ‘losing it’ or having difficulty remembering some facts. Evaluate whether your parent can understand the context and consequences of a choice and make an informed decision. If they cannot, you may need to have them legally declared incapacitated because they may lack the ability to sign a document such as a power of attorney.
Comprehensive estate planning not only includes getting your finances and will in order but should also include discussions on whether a power of attorney (POA) is suitable for you or your parent. Elderly parents may need assistance making both financial and medical decisions, and a power of attorney can alleviate issues stemming from cognitive decline. But how do you obtain a power of attorney, and what type is right for you?
Planning for a power of attorney can require difficult conversations. Prepare yourself by reading the following article to understand the basics of getting your parent a power of attorney that advances their wishes.
How Does a Power of Attorney Work
A power of attorney is a legal document that assigns rights and duties from your elderly parent - also known as the principal - to you or another trusted loved one. Once a power of attorney is signed, you or your parents’ loved one becomes an agent, also called the attorney-in-fact.
The agent can act on behalf of the principal, making decisions such as paying bills, managing investments, or whether to have surgery. The scope of the agent's duties and whether they can make certain choices is determined by the terms of the power of attorney and law.
Why an Elderly Person Should Get a POA
As we age, life can become more complicated, and legal matters can become increasingly challenging. A Power of Attorney can be a critical tool in ensuring an individual's wishes are honored, and their affairs are managed appropriately.
It's important for elderly individuals to weigh the many reasons supporting the decision to get a Power of Attorney:
Incapacity
A common reason for getting a Power of Attorney is to plan for incapacity. As we age, our mental and physical health can decline, and issues can arise that prevent us from managing our financial and legal affairs. With a Power of Attorney, an elderly person can choose a trusted person to manage their affairs if they become unable to do so themselves due to incapacity.
Convenience
Another reason to get a Power of Attorney is for convenience. An elderly person may have difficulty managing their affairs due to mobility issues or other health problems. A Power of Attorney can allow them to delegate specific tasks or responsibilities to someone else, making their life easier.
Avoiding Guardianship Proceedings
A well-drafted Power of Attorney can help an elderly person avoid guardianship proceedings in the event of incapacity. Guardianship can be a costly and time-consuming process that may not respect the individual's wishes or preferences. By granting a Power of Attorney before incapacity occurs, an elderly person can avoid the need for guardianship.
Financial Affairs
Managing financial affairs can become more challenging as we age. An elderly person may have multiple accounts, investments, and assets that require attention and management. With a Power of Attorney, they can delegate financial management responsibilities to a trusted person who can help them stay organized and meet their financial obligations.
Healthcare Decisions
Healthcare can be another challenging aspect of aging. An elderly person may require medical care, and decisions need to be made about their treatment. A Power of Attorney can grant healthcare decision-making authority to a trusted individual who can make healthcare decisions on the elderly person's behalf and in accordance with their wishes.
Types of POA Available
There are a variety of types of power of attorney documents available. The first choice is between a financial POA and a medical POA.
Some people may want one loved one to make medical decisions and another to handle their finances. However, remember that for the elderly, healthcare decisions can quickly become financial choices. For example, whether to receive care at home or in a managed facility often requires reviewing costs.
Another type of POA is called a springing power of attorney. These only come into force once the principal is declared incapacitated.
Finally, you may want to ensure your power of attorney is durable. This means that the arrangement remains in force even if the principal is declared incapacitated.
Rights an Agent Has With POA for Elderly Person
For the agent, the rights and limitations by POA type change. If you are an agent for a medical POA, your decision-making rights are limited to health care (and, sometimes, paying for it).
Likewise, if you are the agent for your parent’s financial power of attorney, you cannot decide whether your parent needs to see a medical specialist on their behalf. Or if they should receive care in an assisted living home instead of trying to fend for themselves at home.
How to Set up a Power of Attorney for an Elderly Parent
Sometimes, it may be difficult to get an elderly parent to agree that the time may be right for end-of-life discussions. However, having conversations about the importance of a Power of Attorney before your parent needs someone to make decisions on their behalf is essential.
You might want to try the following approach:
- Talk openly and honestly about the benefits of having a Power of Attorney: Use good communication skills and be understanding if they are initially hesitant. Emphasize the importance of having these conversations before the need arises for someone to make decisions on their behalf.
- Include a discussion as part of estate planning: Highlight that part of preparing for the future is protecting what your parent has accumulated through hard work. Explain that having a valid Power of Attorney is a crucial component of this comprehensive planning.
- Seek assistance from financial planners or estate consultants: These professionals have experience in navigating delicate conversations regarding Power of Attorney. Their guidance can provide valuable insights throughout the process.
Power of Attorney for a Parent with Dementia
Once your parent has Alzheimer's disease or any type of dementia, it will be difficult to obtain a power of attorney without consent. Unless your parent is still legally competent, they will be unable to sign a power of attorney agreement. Instead, you may need to petition a court to allow you to be appointed their conservator or guardian. However, being an agent under a power of attorney vs. guardianship has many differences.
For one, being a court-ordered conservator or guardian means that your duties are derived from a judge. Having an enforceable power of attorney means that your parent expressed their desire to have their agent make decisions on their behalf. Your parent also agreed to a certain scope of duties for the agent.
If you do not have a power of attorney in place before your parent is unable to legally make their own choices, you may face numerous fights. For one, there is no guarantee a court will appoint you to be the parent’s guardian. Since your parent can no longer clearly express their wishes, you may be faced with someone else having control of their finances and health care choices.
Create an Official Power of Attorney
FAQs About POA for Parents
-
When is the right time to set up a power of attorney for an elderly person?
There is never a wrong time to set up a POA for your parents. Usually, this should be discussed during an annual estate planning session.
-
How to get power of attorney for elderly parents revoked?
If you think your elderly parent has granted POA duties to the wrong individual, they will need to formally revoke this while still competent. They can do this by ending that arrangement through a statement or legal attestation, then possibly appointing a new agent or creating a new document.
-
How to evaluate the “capacity” of an older person?
The legal definition of capacity differs from your elderly parent simply ‘losing it’ or having difficulty remembering some facts. Evaluate whether your parent can understand the context and consequences of a choice and make an informed decision. If they cannot, you may need to have them legally declared incapacitated because they may lack the ability to sign a document such as a power of attorney.
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