Power of Attorney vs. Advance Directive: Which Is Right for Me?

Power of attorney vs. advance directive: Key differences

While both legal documents help protect your interests when you can't act for yourself, they have different purposes and abilities, including the following. 

Scope of authority

A POA can give your agent broad authority to handle all financial and legal matters, such as paying bills, handling investments, or managing your business. Some states (such as Florida) even allow POAs to specify medical preferences, but this isn't always the case. 

In comparison, an AD only focuses on healthcare decisions and advance care planning. While it can have several components (such as a living will and healthcare proxy), an AD can't give anyone power over your finances or legal affairs. 

Activation timing

A POA can go into effect immediately, at a specified time, or when certain conditions are met. For example, you might give your agent temporary authority to oversee your business while you bond with a newborn. However, an AD typically only takes effect when you can't communicate your own healthcare wishes. This might be due to temporary unconsciousness, incapacity, or any serious illness that affects your ability to make decisions or express your preferences.

Decision-making authority

With a POA, your agent can act within the scope you've defined. In other words, you give them permission to essentially step into your shoes and handle the matters you specify—whether broad or narrow. 

While an AD may include a healthcare power or proxy, its primary purpose is to document your medical preferences as a contingency. Moreover, any proxy you name is generally expected to follow your stated wishes rather than make independent decisions. 

State recognition

All states recognize powers of attorneys and advance directives, but specific requirements and laws vary. Some states have standardized statutory forms, while others are more lenient in how you word or draft the documents. 

The requirements to make either document legally valid may also vary. For instance, some states require document notarization, specific witnessing procedures, or particular language or phrases to be included. 

How POA and AD work together

Medical emergencies rarely affect just your health. Bills still need to be paid, work obligations must be met, and financial decisions can't wait. In these kinds of situations, a POA can handle the practical matters while your healthcare providers follow your advance directive's instructions for treatment. 

Moreover, without clear documentation of your preferences and who you trust to make decisions, relatives might disagree or act in ways that don't honor your desires. With both a POA and AD, however, you can protect sensitive financial matters and ensure your wishes are known. 

How to establish a POA and advance directive

You can create a power of attorney and advance directive on your own or work with professionals—whether an attorney or estate planning service like LegalZoom. Here's a breakdown of the general process to create both an advance directive and a POA.  

1. Consider your needs. Think about your medical preferences for your AD and which powers you want to grant in your POA (along with any special features). 
2. Choose your representatives. Choose an agent or proxy who understands and respects your wishes. 
3. Draft the documents. Following your state's laws, either use pre-approved forms or gather all the required information to create your own documents. Be sure to follow any witnessing or notarization requirements, too. 
4. Consult legal professionals. It's highly recommended to consult a local attorney or use a reputable estate planning service like LegalZoom to ensure your POA and AD function as intended. 
5. Store and distribute properly. Keep the original documents safe and provide copies to relevant parties (e.g., medical professionals, your healthcare facility, or family members). 
6. Review regularly. Periodically review and update each document as circumstances change. 

These are both estate planning tools you'll want to prioritize while you're healthy and able to express your wishes. Regardless of how you create them, be sure that your chosen agent or proxy understands their responsibilities and is willing to act on your behalf if ever needed.