In 2022, 33% of Americans over 55 have a will where they get a power of attorney. The decision to appoint someone as your power of attorney is vital as it grants them the right to manage your financial and personal affairs if you cannot do so.Â
It is essential to consider which is right for you, as this can significantly impact your ability to decide your future. If unsure, it is best to get started on having one. A power of attorney can be enduring or lasting, but what’s the difference between the two?
Read on to learn the difference between enduring and lasting power of attorney.
Why People Need a Power of Attorney
Most people don’t need a power of attorney (POA), but there are certain life circumstances where having one can be helpful. A POA gives another person the authority to make decisions on your behalf. The person you name your power of attorney is your “agent” or “attorney-in-fact.”
There are two different types of power of attorney: enduring and lasting. Enduring Powers of Attorney is used when you want your agent to have the authority to decide on your behalf, even if you become unconscious or incapacitated.
Lasting Powers of Attorney are used when you only want your agent to have the authority to make decisions. At the same time, you are still conscious and capable of making your own decisions.
You can use both types of power of attorney for various purposes, including managing your finances, making medical decisions, and dealing with legal matters. You can tailor the power of attorney to fit your specific needs and give your agent as much or as little authority as you want.
Most people choose to name a spouse, family member, or close friend as their agent. Choosing someone you trust to make decisions in your best interest and who you feel is essential.
Difference Between Enduring and Lasting Power of Attorney
The main difference between an enduring and lasting power of attorney is that you can only use an enduring power of attorney if your state in the document is to remain in effect if you become mentally incapacitated. With a lasting power of attorney, there is no need to specifically state that it is to stay in effect if you become mentally incapacitated, as a power of attorney expires if you become mentally incapacitated.
What is Mental Capacity
Mental capacity is the ability to make decisions for oneself. People may lose mental capacity due to an illness or injury or as they get older. If a person does not have mental capacity, they may not be able to make decisions about their life, including their finances, property, healthcare, or welfare.
The grantor should decide whether to use an EPA or an LPA while the grantor still has mental capacity. Suppose the grantor later loses cognitive ability and an LPA has not been set up. In that case, the grantor’s family or friends may apply to the court as the grantor’s property and financial affairs deputy.
Can Several Powers of Attorney Work Together?
It is perfectly possible in terms of the powers of an attorney working together. For example, you may have one power of attorney for your financial affairs and another for your healthcare decisions. It is crucial to ensure that the different powers of attorney do not conflict with each other and that each power of attorney is aware of the others.
How to Set Up a Power of Attorney
To set up a power of attorney, you must be 18 years or older and of sound mind. You will need to designate someone you trust to act on your behalf, and you will need to sign the document in front of a witness.
An enduring power of attorney can be revoked anytime, as long as you are of sound mind. You can only void a lasting power of attorney if you go to court and have a judge agree that you should revoke it.
A power of attorney is a way to make sure that your affairs are taken care of if you become incapacitated. It is essential to choose someone you trust to act on your behalf and to understand the difference between enduring and lasting powers of attorney.
Costs of Setting Up a Power of Attorney
Costs of setting up a power of attorney can vary depending on the type of power of attorney you need, the complexity of your financial affairs, and whether you use a solicitor or a DIY will kit. Generally speaking, you can expect to pay anywhere from $500 to $2000 for a solicitor to prepare an EPA or LPA. If you have a simple financial situation, you may be able to prepare an EPA or LPA using a DIY will kit, costing you less than $100.
Can Family Object to a Power of Attorney
If a family member objects to a power of attorney, they can apply to the court to have it set aside. The court will consider whether the grantor validly made a power of attorney and whether the attorney acted in the best interests of the person who made a power of attorney.
How to Make Changes with Your Power of Attorney
You can change your power of attorney anytime, as long as you can. If you want to change your power of attorney, you must contact the relevant authority, such as the Office of the Public Guardian, and fill in the necessary forms.
How to Deal with Problems with Your Power of Attorney
If you have a problem with your power of attorney, you should first try to resolve the issue with the person you appointed as your attorney. If that doesn’t work, you can contact the Office of the Public Guardian, which can help you revoke or cancel a power of attorney.
When it comes to powers of attorney, it is important to understand the difference between enduring and lasting. An enduring power of attorney remains in effect if you become mentally incapacitated. In contrast, lasting power of attorney only comes into effect once you have lost mental capacity.
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