Estate planning is important for New Jersey adults of all ages. While many people think they can put it off until they are older, it is a good idea for everyone to have basic estate planning documents in place once they reach the age of majority. People can unexpectedly suffer serious injuries or contract debilitating illnesses that could impact the rights of their families to make important decisions for them. In addition to a will, an important document everyone should consider is a durable power of attorney.
What is a durable power of attorney?
A durable power of attorney (POA) is an estate planning document through which an individual can grant the legal authority to make decisions for them to a trusted third party. People might create POAs when they will be absent for an extended period and need someone else to be able to make decisions for them while they are gone. They might also be important when a person is incapacitated by an injury or illness and can no longer make decisions for themselves.
Types of POAs
Powers of attorney include a durable financial power of attorney or durable health care power of attorney. A financial POA grants the authority to make financial decisions to an agent. However, this person does not have to be an attorney and can instead be anyone the individual trusts to make decisions for them. A health care power of attorney is a POA through which an individual can grant the authority to the agent to make health care decisions for them if they are unable to do so themselves.
Many people who create POAs create springing powers of attorney. These documents only become effective if and when the individual is incapacitated as certified by two or more doctors. When that occurs, the power to act will become effective. However, POAs will terminate when the principal dies.