A Power of Attorney (POA) is a legal document that allows one person (the principal) to grant another person (the agent or attorney-in-fact) the authority to act on their behalf. In New Jersey, a Power of Attorney can be used for various purposes, including managing finances, making healthcare decisions, or handling legal matters. Understanding how POAs work and how to create one can help individuals ensure their affairs are managed according to their wishes.
Types of Power of Attorney in New Jersey
In New Jersey, there are several types of POAs, each serving different purposes:
- General Power of Attorney: Grants broad powers to the agent to handle financial and legal matters, such as managing bank accounts, paying bills, and signing contracts.
- Limited (Special) Power of Attorney: Grants the agent authority to act in specific situations, such as selling a property or managing a particular bank account.
- Durable Power of Attorney: Remains in effect even if the principal becomes incapacitated. This type is commonly used for long-term planning.
- Springing Power of Attorney: Becomes effective only upon the occurrence of a specified event, such as the principal’s incapacity.
- Healthcare Power of Attorney: Allows the agent to make medical decisions on behalf of the principal if they become unable to do so themselves. Often combined with an Advance Healthcare Directive.
Why You May Need a Power of Attorney
A POA ensures that your personal, financial, and medical affairs are managed if you become unable to make decisions for yourself. Common reasons for creating a POA include:
- Planning for incapacity due to illness or injury.
- Allowing someone to manage financial matters during travel or extended absence.
- Designating someone to handle healthcare decisions in emergencies.
Without a POA, family members may need to go through a court process to obtain guardianship or conservatorship to manage your affairs, which can be time-consuming and costly.
How to Create a Power of Attorney in NJ
- Choose an Agent: Select a trustworthy individual to serve as your agent. This person should be reliable and capable of managing the responsibilities assigned.
- Determine the Scope: Decide whether you need a general, limited, durable, or healthcare POA, and outline the specific powers you wish to grant.
- Draft the Document: Use a POA form that complies with New Jersey law or consult with an attorney to ensure the document meets legal requirements.
- Sign and Notarize: In New Jersey, the principal must sign the POA in the presence of a notary public. While witnesses are not legally required for most financial POAs, they are often recommended. Healthcare POAs typically require two witnesses and/or notarization.
- Distribute Copies: Provide copies of the signed POA to the agent, financial institutions, healthcare providers, and any other relevant parties.
Revoking a Power of Attorney
The principal can revoke a POA at any time, as long as they are mentally competent. To revoke a POA:
- Draft a Revocation of Power of Attorney document.
- Notify the agent and any institutions or individuals who were given the original POA.
- Retrieve and destroy copies of the old POA, if possible.
Conclusion
A Power of Attorney is a vital legal tool for managing your affairs in New Jersey. Whether for financial, legal, or healthcare decisions, creating a POA ensures that someone you trust can act on your behalf if necessary. Consulting with an experienced attorney can help ensure your POA meets legal standards and accurately reflects your wishes.