Powers of Attorney (POA) are state specific documents. That means each state has its own rules on what each document must say and how it must be executed. Because of this, a POA from Arizona may not work in Ohio and vice versa.
In Arizona, there are three separate POAs:
- Healthcare, and
- Mental Healthcare.
Arizona is only one of a few states that have the latter so many out-of-state healthcare documents are ineffective when it comes to helping a patient with Alzheimer’s, dementia, or a traumatic brain injury.
If you just moved here from another state you should make sure to update your POA documents. Snowbirds should have a state-specific set of documents for each state they live.
Difference Between Springing Power and Durable Power
POA’s must identify whether the agent has a “springing” power or “durable” power.
Springing: If an agent has a springing power, they can only make medical decisions or manage your finances if you are not physically capable or are mentally incapacitated. One disadvantage of naming a springing power of attorney is that payment of bills and investment of assets is delayed until all documents confirming your mental incapacity are signed.
Durable: A durable power takes effect the moment you sign the document. A durable POA provides your agent the immediate authority to manage, spend, and invest your assets on your behalf; and sign your name on legal documents. This speeds up the process of paying bills and asset management, but you should have complete trust in the individual you choose to act as your agent.
Both healthcare POA’s only have springing powers. You will continue to make healthcare decisions for yourself until 1) you no longer can communicate, 2) you cannot give informed consent, or 3) you are legally incapacitated. A financial POA can either be springing or durable.
Who Should You Choose to be Your POA?
An ideal healthcare agent is:
- Someone willing to ask tough questions who is not intimidated by medical professionals.
- Someone who can make tough decisions in a time of crisis.
- Someone capable of setting aside their own feelings about a treatment option or procedure to make sure your wishes are followed.
- Someone who understands your choices about end-of-life care.
An ideal financial POA is:
- Someone who is organized.
- Someone who is good at balancing a checkbook and paying bills in a timely manner.
- Someone who is comfortable with basic investments.
- Someone who will seek the advice of, and easily work, with tax professionals and financial planners.
You should list at least one or two other people as a back-up in case your first choice is unable to carry out your wishes.