Understanding the Differences Between Wills and Powers of Attorney in Kentucky
When it comes to planning for the future and managing important legal and financial matters, two commonly used instruments are a Last Will and Testament and a Power of Attorney. Both of these legal documents are essential to safeguarding an individual’s interests, but they serve different purposes. Let’s delve into the differences between a will and a power of attorney to better understand their functions and importance.
A last will and testament (often referred to simply as a “will”) is a legal document that outlines a person’s wishes for the distribution of their assets and property after their death. It serves as a crucial tool for estate planning, allowing individuals to have control over how their belongings are distributed among their loved ones, friends, or charitable organizations. A will can specify beneficiaries, designate guardians for minor children, and provide for the disposal of assets that hold sentimental value. A will also nominates a person or institution to serve as “Executor,” charging them with ensuring that the individual’s estate is properly administered and distributed.
A power of attorney is a legal document that grants another person the authority to make decisions and take actions on behalf of the individual, known as the principal, in the event they become unable to do so themselves. This could be due to illness, incapacity, or absence. A power of attorney can encompass various areas, such as financial, legal, and healthcare decisions, depending on the specific type of power of attorney created. Importantly, a power of attorney terminates upon the death of the principal. Therefore, it is important to also have a will in place to designate an Executor, who can then continue to manage the affairs of the individual’s estate after death.
Both a will and a power of attorney are vital components of a comprehensive estate plan. While a will ensures the distribution of assets after death, a power of attorney empowers a trusted individual to make decisions on the principal’s behalf during their lifetime. Understanding the distinctions between these legal instruments is essential for making informed choices that reflect an individual’s wishes and safeguard their interests. If you need more information about creating a Last Will and Testament or a Power of Attorney, contact attorney Holly Homra at 270-450-8253