The importance of a financial power of attorney

As Ohio residents live longer and longer lives, they are more likely to suffer injuries or develop illnesses that leave them unable to tend to financial matters such as staying up to date with bills or other monetary obligations. Worries about incapacitation leading to financial ruin can be powerful, but they may be eased by drafting a financial power of attorney.

This type of power of attorney designates a trusted individual to take care of important financial matters. A financial power of attorney may go into effect immediately after it is signed or only when the principal is diagnosed with a serious medical condition. While many retirees would be more attracted to the second option, referred to as a springing power of attorney because it springs into effect when required, there are some drawbacks. Doctors may disagree about how incapacitating a condition actually is, and medical professionals may be unwilling to disclose confidential information about their patients.

Statistics from the Centers for Disease Control and Prevention reveal how important it may be for seniors to draft a financial power of attorney. Less than 10 percent of Americans between the ages of 55 and 64 report that they have been hospitalized in the preceding year, but that figure rises to 20 percent for those aged 75 or older. More worrying is the nature of the medical conditions that older Americans may suffer from. Research indicates that about a third of Americans who live into their 80s will be diagnosed with Alzheimer’s disease.

Peace of mind is one of the chief benefits of having comprehensive estate plans. Attorneys who have experience with these matters can explain how having documents such as a financial power of attorney and health care directive may allow seniors to better enjoy their golden years.