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What Is a Durable Power of Attorney?

When you give someone power of attorney, it allows that person to make certain decisions for you. But what makes a power of attorney durable?

Table of Contents

Definition of Durable Power of Attorney

A power of attorney is a legal document in which someone (called the principal) gives authority to someone they trust (called an agent or attorney-in-fact) to act for themselves if they cannot. A durable power of attorney means that the authority given to the agent continues even when the principal becomes incapacitated or incompetent. You define your agent’s authority to handle all matters (a general power of attorney) or only specific ones (a limited power of attorney).

For a power of attorney to be “durable,” it must contain language such as “This power of attorney shall not be affected by subsequent disability or incapacity of the principal or lapse of time” or similar language. If your power of attorney is not durable, meaning it does not have such language, the agent’s legal authority ends when you can no longer make your own decisions. This happens if you are incapacitated or deemed legally incompetent.

Why Do I Need a Power of Attorney?

People appoint a power of attorney to help them when they can’t handle their own decisions. There are many reasons for this. A person may be traveling and want someone else to manage their affairs, or the person is incapacitated and can’t speak for themselves. If you are making plans for an emergency, end-of-life care, incapacity, or incompetency, you may want to appoint a loved one to make decisions for you when you are no longer able to do so yourself. If this is the case, a durable power of attorney could be your best option.

There are generally two types of power of attorney: a financial power of attorney for managing financial decisions and a health care power of attorney to handle health care decisions.

Financial Power of Attorney

A durable financial power of attorney allows your agent to handle your financial affairs and make financial decisions for you, even when you become incapacitated or cannot make decisions for yourself. There are many key functions a financial power of attorney can serve, including:

  • Paying your bills, taxes, and medical expenses
  • Managing your investment and bank accounts, real estate assets, and retirement funds
  • Running your small business in your absence
  • Handling your general financial matters

A financial power of attorney can help ensure that your savings, investments, and livelihood remain safe when you cannot maintain them.

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Reasons To Establish a Durable Financial Power of Attorney

The main reason to establish a durable financial power of attorney is to keep your finances safe if you are unable to manage them yourself. This includes:

  • Paying your bills and taxes
  • Managing your real estate
  • Completing financial transactions while you are out of the country
  • Managing your investments
  • Transferring or selling your property/assets
  • Engaging legal counsel for legal advice, including specialists in elder law or family law

Financial powers of attorney are also important for business owners. You have worked hard to grow your business, diversify your investments, buy real estate assets, and more. An agent will ensure to make payments on time and manage business operations in your absence.

Health Care Power of Attorney

A health care power of attorney allows the agent to make medical decisions for you if you cannot do so for yourself. Through a health care power of attorney or health care directive, your agent can:

  • Speak with doctors to discuss options for medical care and decide treatments for you pursuant to your health care directive
  • Receive updates from the health care provider about your private medical information
  • Carry out your stated wishes in your health care directive with regards to the type of medical care you desire, such as how long to continue care, prolong life, or refuse treatment or take measures to prolong life
  • Determine nursing home or assisted care facility

A health care durable power of attorney is used in conjunction with or merged with a health care directive, sometimes called an advanced directive or living will. The health care directive sets out specific wishes for medical care, such as continuity of care or palliative measures desired at the end of life.

Reasons To Establish a Health Care Durable Power of Attorney

There are many reasons to establish a durable health care power of attorney. If you have recently been diagnosed with an illness that may lead to an inability to make decisions for yourself (such as dementia or a brain tumor), you may want to create a power of attorney. Doing so avoids a time-consuming and expensive process for court-appointed guardianship or conservatorship.

A durable health care power of attorney is essential if you are single and want a close friend or romantic as your agent. If the person is not a blood relative, they may only be able to get health information on you with a power of attorney. For some people, there is no pressing medical reason for establishing a power of attorney.

However, just because it isn’t pressing doesn’t mean you should wait to create a health care power of attorney until you are sick. If you want to be the one in control of what happens to you when you are incapacitated, you should consider creating a health care power of attorney now while you are healthy and of sound mind.

How Do You Select an Agent?

A lot goes into choosing a person to serve as your agent. You may be deciding between one of your adult children, one of your parents, or even a close friend. You must choose a loved one who you trust and who can act in your best interests. You should ask yourself if you trust this person with your money and your life because that is what they handle for you.

Whoever you choose, make sure that they understand their responsibilities. You can create instructions for them to follow (like an advanced health care directive), but there might be situations where they have to make decisions on their own in your best interest.

How Do You Establish a Durable Power of Attorney?

For many people, it is easy to create a durable power of attorney. You can access our state-specific financial power of attorney and health care power of attorney forms with guidance on how to properly sign and formalize these legal documents. You should establish a power of attorney while you can still make decisions for yourself. You must be legally competent. Depending on your state laws, you sign the power of attorney in front of witnesses and/or a notary.

When Does a Durable Power of Attorney End?

The principal can revoke a durable power of attorney at any time, provided the principal is competent at the time of revocation. While each state law has varying requirements, it is prudent to revoke a power of attorney in writing and provide it to the agent and any institutions with the original power of attorney document on file. All power of attorney authority, whether financial or medical, ceases upon the principal’s death.

Power of Attorney Documents Are Part of a Sound Estate Plan

While many people may think that a power of attorney is something you only need to think about as you make end-of-life plans in your old age, that is not the case. The truth is that people of all ages can benefit from establishing a durable power of attorney. Your choice of health care or durable financial power of attorney will depend on your specific needs. Many people create both powers of attorney as part of their estate plans.

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Written by:

FindLaw Staff

Contributing Author

Reviewed by:

Catherine Hodder, Esq.

Senior Legal Writer