A power of attorney is a legal tool allowing a principal to designate an agent to act on behalf of the principal. For the most part, people execute these documents so an agent has the right to make decisions regarding the principal’s finances or health care. You should consider enacting a power of attorney as a part of estate planning to ensure there is a competent person ready to manage your affairs.
You would normally execute a general power of attorney in case you lose the competency to make your own decisions. The general form grants broad authority to your agent. Otherwise, you can execute a limited power of attorney if you need to authorize your agent to do one specific act, like paying your bills, for a predetermined amount of time. This could be useful if you know you will be absent from your business.