So you need someone who can act as your legal representative when you are unable to make legal decisions for yourself. For example, you need to obtain a mortgage to be able to borrow money to pay for your hospital and medical bills. If you appoint someone as your attorney-in-fact, that person can sign the mortgage on your behalf. You have to decide one or more of the following tasks that your attorney-in-fact will carry out on your behalf from time to time: manage your properties preparing and filing income tax returns making decisions regarding health care do transactions at the bank and pay your bills handle your retirement and insurance benefits collect your social security benefits handle your legal claims You have two options when deciding how much authority you are going to allow to your agent. You must choose a person who is a lot younger than you are since he or she can carry out the responsibilities for a longer time compared to the older ones. Also, younger people are relatively healthier than their older counterparts, so you can be sure that they can handle your assets without much hassle. He/She should know you well so as to understand your own points of view and opinions. If you think that person really understands your feelings, you could be sure he/she would follow and stick to your personal wishes if ever you get incapacitated. Would the person be willing to spend time to handle your affairs? The term refers to a legal document that allows you to appoint someone who can make important choices for yourself when time comes you can no longer do it for your own. The person you appoint may be a family member, a relative, or a friend whom you are confident enough to make the best choices for you, especially when it comes to decisions regarding your health and finances. There are certain situations in which powers of attorney are not needed. For instance, if you own a big estate, you may be better off preparing a revocable living trust that offers great tax benefits and fits your needs. You may want to consider having both a financial POA and a revocable living trust.