Barbara Stein called me on a Tuesday in late October. Her husband Martin had had a stroke eleven days earlier. He was sixty-nine. He was alive, he was in rehab, but he wasn’t talking much and the left side of his body wasn’t cooperating. The doctors were cautiously optimistic. Barbara was in the parking lot of the rehab facility, calling me from her car, and the thing she needed to tell me wasn’t about his prognosis.
Martin had a brokerage account in his name. Not joint. Just his. It held about $140,000 in retirement savings he’d rolled over from a previous employer before they got married. She also needed to stop the automatic payments going out of his individual checking account (the one he managed, the one whose password she didn’t have). And the investment property they’d been trying to sell since August was titled in his name.
She couldn’t touch any of it.
Martin was alive. He was going to get through this, probably. But he hadn’t signed a durable power of attorney, and without one, Barbara had no legal authority to act on his behalf. The account was his. The property was his. She was his wife of thirty-one years and she could not do a thing without going to court.
That process (a court-supervised guardianship and conservatorship) took eight months and cost them just under $9,000 in legal fees. The investment property sat idle through a cooling real estate market. Martin’s checking account overdrew twice before she got the bank to freeze it, which created its own set of complications. Martin, by the time it was all resolved, had recovered most of his speech and motor function. He signed a durable power of attorney from his recliner the week after the court process closed.
He looked at her and said, “We should have done this years ago.”
Yes. You should have.
Start here: what a power of attorney actually is
A power of attorney is a legal document that authorizes one person (called the agent, or attorney-in-fact) to act on behalf of another person (called the principal) in legal, financial, or medical matters. When you sign one, you are granting your agent the legal authority to do things in your name: sign documents, manage accounts, make transactions, make medical decisions. The scope of that authority depends entirely on how the document is written.
There are four main types, and they’re not interchangeable.
A general power of attorney gives your agent broad authority over your financial and legal affairs. It can cover almost everything: banking, real estate, investments, taxes, contracts. The problem is that a standard general POA becomes void the moment you become incapacitated. This is the critical flaw. A document that disappears when you have a stroke is not planning. It’s paperwork.
A limited (or special) power of attorney restricts the agent’s authority to a specific transaction or time period. You’re traveling for three months and you need someone to close on a property sale while you’re gone. You’re having surgery and you need someone to manage your rental properties for six weeks. That’s a limited POA. Targeted and temporary.
A durable power of attorney is the one that matters for most estate planning purposes. The “durable” designation means the document remains in effect if you become incapacitated. It doesn’t expire when you need it most. This is the document Martin and Barbara didn’t have. It’s also the document missing from the majority of estate plans I’ve reviewed over thirty years. The gap is consistent and the consequences are not minor.
A springing power of attorney “springs” into effect only when a specific condition is met, usually incapacity as certified by one or two physicians. People like the idea of it. Your agent doesn’t have power over you until you actually need them to. The problem in practice is that it requires a formal medical determination before anyone can act, which can delay your agent during exactly the kind of emergency when delay costs money and causes harm. Most estate attorneys I trust recommend the durable POA over the springing version for this reason.
Financial POA and healthcare POA are separate documents
This is the confusion I correct more than any other. People use “power of attorney” as if it covers everything. It doesn’t.
A financial power of attorney (also called a durable power of attorney for finances) governs money and property. Your agent can manage your bank accounts, pay your bills, file your taxes, sell your house, manage your investments, handle your business affairs. This is the document that would have helped Barbara access Martin’s brokerage account.
A healthcare power of attorney (also called a healthcare proxy or medical power of attorney) governs medical decisions. Your agent can consent to or refuse treatments, authorize procedures, make end-of-life decisions, and communicate with doctors and hospitals on your behalf. This is a different document. In most states it’s executed separately, often alongside a living will or advance directive that spells out your wishes regarding specific treatments.
You need both. They cover different things. If you’ve only executed one, find out which one you have and get the other drafted.
The healthcare POA is worth doing carefully. Your agent for healthcare decisions should know your values, not just your preferences. A list of things you do or don’t want is a starting point. A real conversation about what matters to you and why is what actually equips someone to make hard decisions under pressure. The document gives them the legal authority. The relationship and the understanding give them the judgment to use it right.
Choosing your agent
The agent is not a ceremonial role. This person will have real authority over real money and real decisions. Choosing them deserves more thought than most people give it.
The criteria aren’t complicated: trust, capability, and availability. Your agent needs to be someone you trust completely, someone who can handle financial or medical logistics under stress, and someone who will actually be reachable and functional when needed. Those three together will eliminate some candidates who feel like obvious choices.
Your spouse is the natural first choice for most people. Fine, but think it through. If your spouse is also incapacitated (a shared car accident, a simultaneous illness), who steps in? That’s your successor agent, and you should name one. I’ve seen estate documents with no successor named and both primary agents unavailable. The result looks a lot like what happened to Martin and Barbara, except it goes to court immediately.
Your agent doesn’t have to be a family member. A trusted friend, a longtime business partner, or an attorney can serve. What it generally can’t be, under most state laws, is your paid healthcare provider. That’s a conflict of interest the law typically prohibits.
One more thing: tell the person you’re naming. I’ve seen situations where someone named an agent who had no idea, found out after a medical emergency, and had to scramble to understand a document they’d never seen. Tell your agent where the document is. Tell them what it authorizes. Tell them what your wishes are. The document isn’t self-executing. The person holding it has to know what to do with it.
What happens without one
If you become incapacitated without a power of attorney in place, someone who wants to act on your behalf (even a spouse, even an adult child) typically has to petition a court. The process is called guardianship (for personal and medical decisions) or conservatorship (for financial decisions). The terminology varies by state, but the experience is similar everywhere: slow, expensive, and supervised.
Guardianship and conservatorship proceedings require attorney filings, medical evaluations, court hearings, and ongoing annual accountings. The cost to establish varies widely but commonly runs $3,000 to $10,000 or more, depending on the complexity of the estate and the state where you live. The process routinely takes several months. While it’s pending, your finances may be partially frozen, medical decisions may be complicated, and family members may find themselves in court arguing about who should be in charge.
A durable power of attorney typically costs $150 to $300 when drafted by an estate attorney, often less when executed as part of a complete estate plan package. If you’re comparing those numbers, you should.
Revocation
A power of attorney can be revoked at any time, as long as you have mental capacity to do so. You revoke it in writing, sign it, and deliver it to your agent. You should also notify any financial institutions or healthcare providers that have a copy on file.
This matters for a few reasons. Circumstances change. The person you trusted ten years ago may not be the right choice today. A divorce should trigger an immediate review of all estate documents, including any power of attorney that names a former spouse. A serious falling-out with a family member, or a family member’s own declining health or financial instability, are equally good reasons to review and potentially update the document.
The document isn’t permanent. It’s only permanent until you change it, and you can change it as long as you have the mental capacity to do so.
State laws vary, and that matters
Powers of attorney are governed by state law. The rules are not uniform across states, and this creates real practical complications.
Many states have adopted the Uniform Power of Attorney Act, a model statute developed in 2006 that standardizes agent duties, default authority, and third-party obligations. Many states haven’t adopted it, or have adopted modified versions. The result is a patchwork where a document valid in one state may be viewed with skepticism by a bank or healthcare provider in another.
If you’ve moved across state lines since you last executed your estate documents, have an estate attorney in your current state review whether your existing POA meets local requirements. This is a common and easily overlooked problem for people who’ve relocated in retirement.
Financial institutions have also become increasingly cautious about honoring POA documents presented by strangers claiming authority over an account. Some institutions have their own preferred forms, or require the POA to specifically reference certain types of transactions. If you have bank or investment accounts you want your agent to be able to access, it’s worth calling those institutions now to understand what they require. Before there’s an emergency is the right time to have that conversation.
Common mistakes
The most common mistake is not having one. I’ve covered that. The second most common is having one that’s fifteen or twenty years old, naming someone who is now unavailable, deceased, or estranged.
The third most common is giving too little authority. A financial POA that doesn’t specifically address gifting, or doesn’t cover retirement accounts, or omits digital assets and online accounts, will leave your agent unable to handle parts of your financial life that matter. A generic form from a legal website may miss specific provisions your situation requires. Work with an estate attorney who asks about your actual accounts and circumstances rather than handing you a form.
The fourth most common is not telling anyone where the document is. Your agent cannot use a document they can’t find. Give your agent a copy. Tell your attorney where the original is. Tell the institutions that matter. The document sitting in a filing cabinet that no one knows about is not planning. It’s filing.
When to get one
The answer is now. Not after the next health scare. Not when you get to feeling old enough to need it. Now. Because a power of attorney can only be signed when you have mental capacity, and mental capacity is not something you can predict losing or schedule around.
Martin had his stroke at sixty-nine with no warning. He was a healthy, active man with no history of cardiovascular disease. His cardiologist said the stroke was the kind that comes out of nowhere. He was right. It did.
The document itself isn’t complicated to execute. You need a licensed attorney in your state, a witness or two depending on where you live, and in most states a notary. The conversation about who you trust and what you want is the harder part. That’s the part most people avoid. Do it anyway.
This piece lives alongside what actually happens to an estate without the right documents and the living trust versus will question most people get backwards. Together they form the foundation of an estate plan most people delay until they can’t. If you’re also thinking through what your spouse would face financially, not just during incapacity but after death, the survivor benefit rules under Social Security belong in that same planning conversation. They’re more complicated than most people realize.
The discomfort in setting up a power of attorney is real. You’re acknowledging that you might someday not be able to manage your own affairs. You’re naming someone to do it for you. You’re thinking through what you would and wouldn’t want in scenarios you’d rather not think about at all.
That discomfort is exactly why most people don’t do it. It’s also exactly why Martin Stein spent eight months and $9,000 in legal fees getting a court to grant his wife the authority he could have given her in an afternoon.
He knows that now. He got through it. Not everyone does.
If your spouse, your adult child, or someone you care about is going to be left navigating a medical emergency or a financial crisis on your behalf someday, the kindest thing you can do for them is sign the document before they need it.
Glenn Suttner is a CFP and former financial editor who writes about money, retirement, and estate planning. He is not your financial advisor, and nothing here is legal or financial advice specific to your situation. Estate planning documents are governed by state law. Work with a licensed estate attorney in your state.
