Here’s everything you need to know about appointing powers of attorneys for aging parents.
Types of Power of Attorney
There are two main types of powers of attorney that families should consider—one focused on financial decisions and another dedicated to healthcare choices. Each serves a unique role in protecting your parents’ wishes and ensuring that trusted individuals can act on their behalf when needed.
Financial Power of Attorney
A financial power of attorney, often called a durable power of attorney, allows a trusted individual to make financial decisions on behalf of your parent. The term “durable” means the authority continues even if the person granting it becomes incapacitated.
The financial power of attorney has a wide variety of powers—some very narrow, and some very broad. Some powers of attorney are designed for a specific purpose such as talking with the IRS or another governmental body.
Medical Power of Attorney
A medical or healthcare power of attorney allows an agent to make decisions if a person becomes incompetent or incapacitated. This can include everything from routine treatments and medications to major end-of-life decisions. Medical POAs are for everyone, not just seniors.
Why Powers of Attorney Are Important
Powers of attorney indicate who you believe to be trustworthy and competent to make decisions for you. The power of attorney mostly allows decisions to be made on your behalf by someone you trust, without having the intervention of a judge or the court system. In other words, if you don’t have a POA, your state will appoint someone to speak on your behalf. For senior citizens, it’s important to talk with a knowledgeable and experienced estate planning attorney, like those at The Orr Law Group, to make sure they can step up or take charge of decisions when needed.
Risks of Not Having a Power of Attorney
Failing to establish a power of attorney in Iowa or Nebraska will probably result in court involvement through a guardianship or conservatorship. These processes can be costly, time-consuming, and emotionally stressful for everyone involved.
How to Choose the Right Power of Attorney
When getting a power of attorney for your elderly parents, generally, it should be somebody close to you, such as a sibling, parent, spouse, or adult child, but it could also be a close friend or even a financial institution. Here are factors to consider when making that decision:
- Proximity of where the individual lives to where you live
- Whether the person makes good financial decisions for themselves or whether they can make major life decisions
- Whether they understand your financial affairs or end-of-life wishes
- Whether they understand tax, investment, and spending implications or basic to more complicated medical issues
- Whether or not they are good at keeping records
Flexibility of a Power of Attorney
Powers of attorney can be revoked or changed as long as the parent is competent and giving someone the authority to act on their behalf does not take away their ability to override what a child or another agent is saying and doing.
When to Talk to Your Elderly Parent About Power of Attorney
If you notice an aging parent is making decisions that cause concern or if they are having any trouble keeping up with their bills or finances, it may be time to bring up the subject of a power of attorney. Even if your parent is still healthy, many families find that around the age of 75 is an appropriate time to have this important conversation. While it may feel uncomfortable or emotionally difficult, discussing hiring a power of attorney for an elderly parent early can prevent challenges later.
How to Talk with Parents About Power of Attorney
Even if the conversation may be difficult to start, having the talk will give both the parent and child peace of mind and provide increased safety and autonomy. Approaching with empathy usually works well.
If you have questions about establishing a power of attorney, our experienced elder law attorneys are here to help. Contact The Orr Law Group today!