Who will act for you?

When one dies, other people are left in charge of what happens to their assets and other belongings – and to any dependents who survive them. Alternatively, during life, should a medical condition leave a person unable to communicate, someone else will make decisions about their financial affairs and medical care.

You should choose now who you want to make those decisions. You can set up legal documents that name who your personal decision-makers will be. Common types of decision-makers are an agent (also called power of attorney), executor, trustee and guardian.

Power of attorney

A power of attorney, often known as a durable power of attorney or simply POA, allows someone to legally make decisions on your behalf while you are living. Although this designation is a safeguard in case you become mentally or physically incapacitated, some people name and begin working with an agent when age or disability make financial transactions or medical decisions more difficult to handle alone. In addition, an agent may function even if you are capable, but unavailable (for example, in another country). There are two primary kinds of agents with two different roles.

Power of attorney for financial decisions: This is your legal representative to take care of your financial affairs. This person can perform such tasks as bill paying, banking, making purchases and transacting other financial matters on your behalf.

You can limit how much power your agent will have. People who live in another state part of the year may have an agent only for emergency transactions at home. An agent’s responsibilities end with your death.

Power of attorney for medical decisions: This is your legal representative to make health decisions for you if you become unable to make those decisions. This person may need to make choices about administering treatment, medication, nursing home care, hospice care and end-of-life medical procedures. This person is sometimes called a health care agent or proxy.

An agent for medical decisions can play an important role when you have a debilitating condition that isn’t immediately life-threatening, such as a stroke or dementia. In that situation, you may live for many years but no longer be able to make your own decisions.

Executor

A critical component of a will is naming a personal representative, usually called an executor. This is the person who ensures that the wishes you state in your will are carried out. Depending on how detailed your will is, this responsibility could involve overseeing a number of financial and personal decisions.

Trustee

If you have created any trusts, a trustee will be responsible for ensuring that those trusts are handled according to your wishes. The trustee may be an individual or a trust institution or bank.

Guardian

You name a guardian in the event that minor children or other dependents survive you. Your guardian likely will be the one who raises your children or provides ongoing care – or is responsible for managing care for a dependent adult.

How to legally designate your decision makers

Each of your decision-maker roles must be documented legally so they can be recognized by those who will implement your wishes – medical providers, financial institutions, lawyers and others.

You can make these roles legal by naming individuals as:

• POAs for medical and financial decisions in a legal document that your lawyer can draw up.
• Guardian and executor in your will and trustee in your trust document.

Questions for getting started

• Who do I trust to manage my financial affairs?
• Who do I want to make medical decisions for me?
• Who would do a good job as executor of my will?
• If I create a trust, who can manage it as trustee?
• To whom do I want to leave my money and other possessions? (They are your beneficiaries.)