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📖 6 min read
Who manages your money and makes decisions if you can't? Without a POA, a court decides.
📋 Table of Contents
A Power of Attorney (POA) is a legal document that gives someone you trust — called your agent or attorney-in-fact — the authority to act on your behalf.
Think of it as a permission slip. You're saying: "If I can't handle this, here's who I trust to do it for me."
A POA can cover finances, legal decisions, or healthcare — depending on the type you create.
A POA only works while you're alive. When you pass away, the POA ends. That's when your will or trust takes over.
Lets your agent manage your money and property. This includes:
Lets your agent make medical decisions for you. This includes:
Stays in effect even if you become incapacitated. This is what most people need.
Only activates when you become incapacitated. Can cause delays because incapacity must be proven.
Many estate planning professionals suggest considering a durable POA. It takes effect immediately but your agent only acts when needed. The springing type can cause problems when banks require proof of incapacity.
A financial POA can grant broad or limited powers. Here's what most people should know:
Most people grant their agent broad, general authority — especially when the agent is a spouse or trusted family member. This is the most common and usually recommended approach because:
Some powers carry extra risk and require separate authorization. These are sometimes called "hot powers" because they allow your agent to:
Our recommendation: Only grant hot powers if you completely trust your agent and have discussed these scenarios with them. When in doubt, leave them off — your agent can always petition a court if truly needed.
In the Settled questionnaire, you can customize exactly which powers to grant. If you skip the customization, we default to broad general authority — which is what most estate planning attorneys recommend for trusted agents.
Your agent will have significant power over your finances or health. Choose carefully.
Trustworthy
Above all else. This person will control your money.
Organized & responsible
They'll need to keep records and make timely decisions.
Nearby (ideally)
They may need to visit banks, doctors, or government offices.
Willing
Always ask before naming someone. It's a big responsibility.
Financially stable
Someone under financial stress might be tempted to misuse funds.
Name a backup agent. If your first choice can't serve, you want someone ready to step in without going to court.
If you become incapacitated without a POA, your family has to go to court to get a conservatorship (also called guardianship in some states).
This means:
Even your spouse may not be able to access your individual accounts, sell property in your name, or make financial decisions without a POA or conservatorship.
👆 Select your state above to see specific requirements for your location.
Settled generates documents that meet your state's specific requirements. Complete the questionnaire and we handle the legal formatting.
Requirements vary significantly by state — from the number of witnesses needed to whether notarization is required. Make sure your documents comply with your state's specific laws.
Browse All State Guides →Creating a POA is one of the most important things you can do for your family. Here's your checklist:
This content is for general educational purposes only and does not constitute legal advice. Consult a licensed attorney for advice specific to your situation.
Settled helps you create a legally valid POA in minutes.