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Powers of Attorney: Your Most Important Estate Planning Documents

Recently, my father had a stroke. At the time, my parents were living in a two-bedroom apartment (independent living) in a senior community. My mother, recovering from gallbladder surgery, was very weak and was “loopy.” My father was lucky that she had been able to call for help.

At that moment, my brother and I needed Powers of Attorney. We needed one to move our mother to a nursing home and one to make medical decisions for our father. Then we needed to take control of their financial affairs since neither one was in a position to handle their own financial affairs.

We looked for the Powers of Attorney in the file drawer of their desk. Lots of neatly labeled files but no Powers of Attorney. Then a trip to the bank where we emptied the safe deposit box. There were estate planning documents, a trust and a will for each of them, but no Powers of Attorney. Then to their Nebraska attorney’s office. The attorney, who had prepared the trust and wills, told us that he had not prepared Powers of Attorney for them because my parents told him “they already had them.” Bottom line: my parents thought they had Powers of Attorney but they did not.

What are we referring to when we talk about Powers of Attorney? Three different documents:

Financial Power of Attorney

A financial Power of Attorney is a written document naming an agent to act on your behalf in financial matters. These powers are general and all-inclusive and include the power to manage all bank accounts, buy and sell assets, including real estate, apply for benefits and participate in government programs, hire and fire professionals. Generally, to perform any financial act that you do for yourself.

Healthcare Power of Attorney

Iowa law allows you to name an agent to make medical and healthcare decisions on your behalf. This is the Healthcare Power of Attorney, often referred to simply as a Durable Power of Attorney. With the Living Will, discussed below, it is your Advanced Directive (directive made in advance).

Living Will

This is the statement that you do not want the administration of life-sustaining procedures if your condition is terminal or you are in a permanently unconscious state. Your condition must be verified in writing by two physicians.

What did we do about getting Powers of Attorney for my parents? My father was paralyzed on his left side but was competent and could sign his name with his right hand. My mother recovered from her “loopiness” and was able to sign her name. So a few days later we had their Nebraska attorney get their signatures on Powers of Attorney, naming my brother as their healthcare agent and me as their agent for their financial affairs.

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