Creating a Power of Attorney

Creating a Power of Attorney

You may have wondered what happens if your aging parent ends up losing their ability to make financial or health decisions. How will you or other family members help them in these circumstances; how will you know what to do? A power of attorney, or POA, provides the legal ability to decide on another person's behalf, like a loved one or an aging parent.

What Is a Power of Attorney?

A POA is a legal document that provides a person, referred to as the attorney-in-fact or agent, the authority to make decisions and take action on behalf of another person, known as the principal. Depending on the POA's terms, the agent will have either limited or extensive authority to make a legal decision about the principal's:

  • Healthcare
  • Finances
  • Property

Steps to Create a Power of Attorney

There are certain steps you need to take to create a power of attorney. These include:

  1. Determining Your Needs to Help You Choose the Accurate Document

    You will first need to know the various types of POA documents available to you. So, what are your needs? Will you have to take over another person's personal affairs or monthly expenses? Will someone have to take over yours? Do you need or want someone to make business decisions for you? Sell your property?
  2. Determining the Agent

    Depending on the state, the agent might be called an attorney-in-fact. Either way, they will receive the legal authority outlined within the POA to decide on behalf of the other person (the principal). This should be an individual who is:

    • Responsible and trustworthy
    • Won't abuse this power
    • Make decisions in the best interest of the principal
  3. Filling Out the Document

    Once the "needs" have been determined and an agent selected, it is time to fill the document out. This is a simple process, but the document must comply with your state's rules.
  4. Signing the Document

    Sign the document properly to make it legally binding. Again, depending on the state, you might have to sign it in front of a notary and two witnesses. Make copies of the document and keep the original. Many institutions won't accept a photocopy of the document.

Different Types of Power of Attorneys

There are various types of POAs, including:

  1. Non-Durable Power of Attorney

    This type of POA is used for a certain period and typically for a specific transaction where you grant them the authority to act on your behalf. After the completion of the transaction, the non-durable POA ceases.
  2. Durable Power of Attorney

    The durable POA is a bit more binding than the non-durable POA. It might be used for allowing the agent to manage the principal's affairs if they were to become unable to do so themselves. It doesn't have a set period, and it becomes effective right away once the principal becomes incapacitated. It does expire in the event of the principal's death, however.
  3. Medical Power of Attorney

    The medical POA grants the agent authority to take absolute control over the principal's medical decisions if they cannot do so themselves or if they become incapacitated. This typically becomes effective upon the presiding doctor's consent and allows the agent the authority to make all medical decisions for the principal.
  4. Limited or Special Power of Attorney

    This type of POA is used temporarily for one-time banking or financial transactions or selling a certain property. It is most frequently used when the principal cannot complete the transaction because of illness or prior commitments and wants to appoint the agent to act on their behalf.
  5. Springing Power of Attorney

    The springing POA becomes effective when a certain event occurs, such as your incapacitation. The springing POA must be extremely carefully crafted for avoiding any issues in identifying exactly when the triggering event occurred.


Suppose you are incapacitated or take care of a person who has no power of attorney chosen to handle things. In that case, your family will potentially be forced into time-consuming and costly delays. A power of attorney can be reassuring as a way to protect your real estate and financial interests, medical needs, health, and maybe even the manner of your death.