Understanding General vs. Durable Power of Attorney: A Guide

Making day-to-day decisions is a critical part of living an independent life. However, sometimes we all need a helping hand managing finances, healthcare choices, property matters, and other responsibilities. When illness, injury, or aging prevents you from making sound choices, it’s wise to have a plan in place designating someone you trust to make decisions on your behalf.

Two common legal instruments that allow you to appoint an agent are the general power of attorney and durable power of attorney. Understanding the difference between the two is key to putting a comprehensive plan in place.

What is a Durable Power of Attorney?

A durable power of attorney (DPOA) is a legal document that lets you assign someone to manage financial, medical, and legal affairs if you become incapacitated or otherwise unable to make sound judgements.

Circumstances that may require handing decision-making authority over to a designated agent include:

• Major medical procedures or travels
• Diagnosis of a degenerative disease
• General physical or mental decline

A DPOA remains valid even after the principal becomes incapacitated. It provides critical protection in case of unexpected injury or illness.

The power granted can cover broad authority or be limited to specific domains like healthcare or finances. Crafting a customized DPOA ensures your agent only has power over relevant areas.

When Do You Need a Durable Power of Attorney?

There are many benefits to establishing a DPOA before capacity becomes an issue:

• Peace of mind – With a DPOA in place, you can rest assured someone you trust will manage your affairs if you become impaired. This provides comfort and takes a burden off loved ones.
• Avoid guardianship – A DPOA helps prevent the need for court-approved guardianship if impairment occurs. The court process can be expensive, time-consuming, and public.
• Immediate authority – Your agent can make important decisions right away instead of waiting for a guardian appointment. This better protects your finances, healthcare, and property.
• Honor preferences – By thoughtfully choosing your agent and establishing parameters, you can ensure decisions adhere to your values and wishes.

While anyone over 18 can benefit from a DPOA, they are especially prudent for seniors and those diagnosed with diseases like Alzheimer’s. Completing a DPOA provides peace of mind that your affairs will be handled according to your preferences if capacity becomes an issue.

What is a General Power of Attorney?

A general power of attorney (GPOA) authorizes an agent to make legal decisions on your behalf. However, the GPOA is automatically revoked if the principal becomes incapacitated.

The steps involved in creating a general power of attorney include:

• Naming an agent and successor agents
• Defining powers granted to the agent
• Signing the document in front of a notary public
• Having the agent formally accept appointment

A key advantage of a GPOA is that the principal can revoke it at any time as long as capacity is retained. This allows you to rescind authority if your needs or relationship with the agent changes.

Types of General Power of Attorney

There are several different types of general power of attorney (GPOA) agreements that can be created depending on your needs:

Limited or Specific GPOA

This limits the agent’s authority to certain specified areas, such as:

• Finance/Banking – Access bank accounts, pay bills, file taxes
• Real Estate – Manage property transactions like sales, rentals
• Legal Affairs – Handle lawsuits, contracts, estates
• Healthcare – Make medical decisions if incapacitated
• Childcare – Care for minor children or dependents

Temporary or Non-Durable GPOA

This grants authority to the agent for a limited time period, such as while traveling abroad or recovering from a temporary illness. The GPOA is automatically revoked at the end of the specified duration.

Springing GPOA

This specifies an event or condition that must occur before the POA goes into effect. For example, it may spring into effect if a doctor declares you legally incapacitated.

General/Comprehensive GPOA

This grants broad authority over all legal, financial, and personal affairs. It is the broadest form of GPOA and revokes if you become incapacitated.

Special Topics GPOA

This grants authority for specific legal situations such as tax filings, fiduciary powers, claims and litigation, estate transactions, business operations, and retirement benefits.

Key Differences: Durable vs. General Power of Attorney

Issue	Durable Power of Attorney	General Power of Attorney
Remains Valid if Incapacitated	Yes	No
Expires Upon Death	Yes	Yes
Can Limit Agent’s Authority	Yes	Yes
Agent Must Be Formally Appointed	Yes	Yes

A durable power of attorney remains in effect even if the principal loses capacity. A general power of attorney is revoked automatically if the principal becomes impaired.

Both forms of power of attorney end upon the principal’s death. The agent’s legal authority terminates when the principal passes away.

The powers granted to an agent can be restricted with either a durable or general POA. Limiting authority provides better control over which decisions can be made.

For either POA, the agent must formally consent to the appointment. This helps ensure the agent is willing and able to perform the expected duties.

Legal and Practical Considerations

Choosing the right power of attorney is an important decision with major legal and practical implications. Consult an estate planning attorney to understand requirements in your state. Most states have their own POA forms and rules about witness requirements.

It’s also wise to think through practical matters such as:

• Who understands your values and can be trusted to honor your wishes?
• What resources or oversight does your agent need to make sound choices?
• Will your POA require managing real estate, stock accounts, or government benefits?
• Do you need to coordinate your POA with existing advance directives?

Addressing these concerns will result in a tailored POA providing the right level of authority to the best agent.

Conclusion

A durable power of attorney enables someone you trust to manage finances, healthcare, and property if you become incapacitated. It provides critical protection in case of unexpected illness or a degenerative condition.

A general power of attorney is useful for temporary delegation of authority, but ends if you become impaired. Durable POAs remain valid even if capacity is lost, so are essential for aging adults and those facing health concerns.

Consult an attorney to create a power of attorney addressing your specific needs and coordinating with other estate plans. Customizing your POA ensures your healthcare, finances, and property will be managed according to your values.

Frequently Asked Questions

Who should serve as my agent?

Choose a trustworthy person who understands your values. Often spouses, adult children, or close friends serve as agents. Consider naming successor agents in case your first choice is unable to serve.

When does my POA go into effect?

Both general and durable POAs are effective immediately unless you specify a future start date. However, your agent should only act once you become incapacitated or delegate specific tasks.

Can I revoke a POA?

Yes, a principal can revoke either type of POA while capacity is retained. To revoke a POA, provide written notice to your agent and anyone that received a copy.

Is a POA the same as a living will?

No. A living will covers healthcare wishes if terminally ill. A POA designates someone to make ongoing financial, medical, and legal decisions when incapacitated.