In California, there are two kinds of powers of attorney: one for finances and one for medical decisions, also called an advance directive or living will. A power of attorney for finances gives another individual the power to handle your financial affairs if you become incapacitated and cannot manage them on your own, like when you are hospitalized. While you are unable to manage your own affairs, someone else can ensure that your bills are paid and utilities stay on for when you return. The power of attorney is necessary because banks generally will not allow access to your accounts without a formal document giving specific permission to someone else, even if you are the spouse, parent, or sibling of the person who is incapacitated.
Similarly, a power of attorney for medical decisions gives the power to another person to make medical decisions on your behalf if you are incapable of doing so due to illness, accident, or other problem. It specifies what kind of medical treatment you do or do not want, and in the absence of one, the doctors will do all that they can to keep you alive as long as they can, even if you are in a persistent vegetative state. In addition, in California there is the HIPAA authorization for medical records so that the person who is making your medical decisions can also look at your medical records.
Every individual 18 or over needs to have these three documents. Sometimes, parents assume that their college-age children do not need these documents because they will be listened to as parents. This is not always the case, so any child going off to college, or just turning 18 needs to have these documents. Similarly, aging parents need to have one as well to avoid the difficult conservator process if they become incapacitated without proper powers of attorney.