A power of attorney is a legal document whereby you can authorize another person to perform financial or other actions for you, just as you would be able to. Within this arrangement, the person who grants authority over his or her affairs is called the principal, and the person who accepts authority is called the agent or attorney in fact.

Usually, it is a good idea to execute a power of attorney as a part of estate planning. This would enable someone else to manage your property and healthcare decisions as soon as needed if you become incompetent.

It is important to select an agent only after careful consideration. The agent should be someone you have great trust in, because you want the agent to act in your best interests and the agent will have potentially a great deal of control over your property and well-being. Often, people will choose their spouse, close relative or friend, or an attorney or trusted advisor.