There may come a time where you can no longer act on your own behalf. If you become mentally incapacitated due to a major accident or illness, you’ll need someone who can make decisions and execute them on your behalf. A power of attorney document can authorize a person or organization to take control of your affairs, as though you were doing them yourself. Creating a power of attorney document requires the skill and experience of an attorney who knows how to grant the right level of control to whomever you designate.
At Chestnut Hill Legal, we know how important it is to set up your power of attorney structure as accurately as possible. We can help you create the correct type of power of attorney document that ensures the business you need to be handled is in capable hands, whatever may happen in your future.
If you become incapacitated and a loved one needs to manage your affairs, they will either have to present a power of attorney document in which they are named the agent, or petition the Orphan's Court for guardianship.
Guardianship proceedings are costly, time-consuming, and should be avoided when possible. With a power of attorney, you name a trusted family member or friend as your agent and empower them with the authority to manage your affairs, without having to go to court.
As mentioned above, court-ordered guardianship over you is the alternative if you are incapacitated and without a power of attorney in place. These proceedings usually cost thousands because you'll need to hire an attorney to submit the petition, prepare notices, and to represent the person seeking guardianship in court at a hearing to determine whether or not you are incapacitated under the law. To prove this, it is usually necessary to secure the testimony of a medical professional, which adds hundreds or thousands to the bill.
In contrast, drafting a power of attorney in advance costs $1,000 or less (see prices below), and allows your agent to act immediately, without having to wait for the conclusion of guardianship proceedings.
As mentioned above, guardianship proceedings can take a month or more at a time when quick action may be necessary on your behalf. For example, bills may need to be paid from your account. Without a power of attorney or guardianship, your loved ones do not have the authority to access your funds. The delay in securing guardianship, which is by no means guaranteed to be a success, may be the difference between on-time and late payment and could result in a negative mark on your credit score.
With a power of attorney, there is no delay as your agent has the authority to act for you immediately.
One power of attorney document doesn’t necessarily grant someone total control over all your affairs to do as they please. While this is what some people want and can be arranged, most people create separate power of attorney documents to divide their affairs between people who can best handle each specific aspect. Thus, there are many different types of power of attorney documents.
- General Power of Attorney: This can be used to authorize a person or organization to act on your behalf for just about anything, including financial and business transactions, life insurance claims, business interests, and whatever else you need. These are the “all-inclusive” types of powers of attorney documents.
- Healthcare Power of Attorney: Healthcare powers of attorney give someone the ability to make medical decisions for you in the event you can’t make them yourself. This person will be able to authorize treatment or indicate whether or not you wish to be kept on life support.
These documents can only be signed while you are “of sound mind,” meaning you are fully coherent mentally. Creating one of these plans well in advance will ensure their durability should one ever need to be put to use.
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