Setting up a power of attorney (POA) is one of your options when it comes to managing your daily financial affairs and transactions under certain circumstances such as when you are undergoing medical treatment or out of the country. It refers to a legal document that allows an individual or a financial institution such as a bank to manage your finances whether you are capable or not of doing it on your own. Because it can have legal consequences, the transfer of power or the authorizing is written as a legal contract, which is shown to people before the attorney-in-fact can proceed with his dealings on behalf of the client or the principal. Often, when the attorney-in-fact is being paid, a separate contract is drafted for the payment and is not shown to other people. Abuse of the power of attorney could be intended or a sign of negligence. For example, a niece who runs off with her aunt s money when given the power of attorney is a sign of intended abuse. The principal may not be able to monitor how transactions are made and eventually caused the agent to misuse his or her finances. If you want to have a say on who will take care of your affairs when you become incapable of doing so, then it makes perfect sense to create a power-of-attorney document. When is the best time to get a power of attorney? The answer is simple: now. It is because a POA is designed to protect yourself and your assets when the unexpected happens such as a debilitating illness or a serious injury. If you need to establish a durable power of attorney, take note that you are providing your agent the following authority: withdrawing your money from bank accounts and spending it; selling your property; and pursuing legal actions and insurance claims. If you are uncomfortable with the setup, you may decide not to get a durable power of attorney or any form of power of attorney at all. A financial agent s concert would be centered on the financial condition and issues of the principal. While the health care agent would be overseeing the principal s medical decisions. The attorney-in-fact or the agent does not have to be lawyer. H/she could be a relative, a daughter or son and even a trusted friend.