Nobody can predict the future. Your doctor cannot promise that you are in perfect health with no accidents on the horizon or have an undetected illness. You cannot declare that there will be no debt or financial obligations that you cannot ever handle yourself. Life happens and sometimes in ways we least expect. If you have a living will, your wishes are protected only as far as life sustaining efforts are concerned. There is no power for any surgeries or care decisions that may be required. No provisions for your financial obligations, your real estate, your taxes.
A power of attorney is a type of legal document in which you declare that you are assigning another person (a close relative or a trusted friend) the authority to make certain decisions on your behalf while you are temporarily unable. The person to whom you give these rights to is called an "agent". You, as the designator, are called the "principal." The agent is a "fiduciary", which means that he or she must perform any decisions with your best interests in mind and completely in good faith. Good faith simply means that something is being done without the intent to deceive.
For a regular document, a "limited" agreement, the agent can only perform tasks that the principal could perform themselves if they were able. The inability to perform the tasks could be a temporary absence or hospital stay. In order for the agent to be able to perform these tasks in the event of a disability such as a coma or mental incapacitation, legal verbiage must be incorporated into the document to make it a "durable power of attorney". This document goes into effect immediately upon signing. What this means is that even if you are capable of performing these tasks and making these decisions, your agent can make decisions independently of you. This is why it is of utmost importance to have an agent that is trustworthy.
For health care issues, an agent cannot commit the principal to a mental institution, agree to convulsive treatment, sign off on psychosurgery, agree to to abort a pregnancy of the principal, and agree to neglect of comfort care (withhold water and artificially supplied nutrition if it deemed in the the best interest of the principal).
For financial issues, an agent cannot convey your real estate, pay themselves out of your money, make gifts or loans with your money to a third party, make gifts or loans with your money to themselves or the power to appoint another person as an alternate or successor agent.
Without any provisions made by you, health care decisions would be made by your physicians or medical care team. Financial decisions would be left to the laws of your state or a conservator would be appointed after court proceedings. In order for sound health care and financial decisions to be made, should you ever be unable to perform these tasks yourself, a durable power of attorney could be a very wise decision for you. The power can be revoked at any time by you, should you feel that would be in your best interest.
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