When I went to the bank to execute my mother’s durable power of attorney during her recent hospital stay, the manager looked at me through the glass partition at the front desk and nodded. He didn’t even look at the duly signed and notarized papers that I begrudgingly held up. He simply said, “Sorry, if your mother can’t come to take care of things herself, you’ll need a court order.” Fortunately, I was armed with knowledge from estate-planning experts and people who had been through this before. I stood by my word. A power-of-attorney document is an absolutely essential part of estate planning that allows you to designate a trusted person to handle your finances should you become incapacitated. If you don’t, the people in your life will have all kinds of trouble handling your affairs, and you could end up with bills in collections and past due mortgage payments. Eric J., an officer on the board of directors of the National Academy of Elder Law Attorneys, who practices in New York. “I’ve seen foreclosures that could have been avoided if someone had a power of attorney,” Einhart says. Most of the advice you’ll see about power-of-attorney documents is intended to be filled out by the person (known as the agent) who is actually going to use it (known as the principal). But the agent is the one who really needs help, because that person is the one who has to fax or email or deliver documents in person to any bank, credit-card company, medical biller, insurance company, loan servicer or government agency. involved, and deal with whatever hoops need to be jumped through. Just a note here about fakes. When is time of the essence – and when is it not? – You may be tempted to take shortcuts. If the bank won’t accept a power of attorney and the caregiver needs to pay, for example, you might find it easier to sign the principal’s name on the check. You finally have permission right? The catch is that it’s simply not legal. It is also easy to access and make payments through one’s online account. Given the prevalence of elder financial abuse, stricter rules make sense, even if they like tasks for people they’re just trying to help. “I’m sure that’s one thing that’s done — it’s just human nature. But I would never suggest that,” Einhardt says. If you’re going to try to do things the right way, when you’re power Here are the biggest problems you may encounter when trying to execute a power of attorney and what you can do about it.1.They want the person to show up If I wanted an easier time on my mom’s paperwork, I would have gone to the bank with her before she got sick and executed a power of attorney, but we never got around to it. Michael Picone, a creative director based in New York, was able to do that with a friend he was trying to help, and he initially facilitated the process. But when he made the list to the Social Security office, the friend was too ill to accompany him, and Picon hit the end of his rope with the paperwork. “It broke me,” he says. “The office was full of angry, tired, frustrated people. I had a briefcase full of papers, and it didn’t contain the essentials. I cried. I just couldn’t deal with it.” But, of course, he got over it, and he ended up writing a guide to the caregiving process, “The Power of Attorney Notebook: Everything You Need to Manage Your Loved One’s Estate.” A major Thing he learned: The principal has no legal reason to be there, so stand your ground and keep pushing. 2. They say there is something wrong with the documents Virtually anything can cause a financial entity to withhold power-of-attorney acceptance. Each state has its own rules, and each organization has different standards. Sometimes a power of attorney can be rejected because two people are named as agents instead of one, the notary stamp doesn’t include the right wording, or the document isn’t described as “enduring” (meaning it’s in effect continuously, only under certain circumstances). . “Unfortunately, it’s case-by-case depending on the company,” says Daniel Miura, a certified financial planner who specializes in family care. “Everything is boring. All this is just a waiting period. Sometimes they’ll accept it, and sometimes they’ll reject it.” The only way out of this is to do the best you can with what you’ve got, especially if it’s too late to change the document. Picone says he just tells his story to anyone who will listen. kept saying, and finally found people who took pity on him. He hasn’t been successful in some areas involving government benefits, but he’s still asking questions. In my case, once I convinced the bank to look at my paperwork, They sent me off with homework. I had to find the death certificate of my father, who had died several years ago but was still named on the account. Luckily, I’m good at scavenger hunts, and after another two-hour visit, I came across the account. Gone. If I can sit through the whole process again, I can also access her safe-deposit box, but they won’t address both in the same appointment. 3. Acharya dies A common misconception about power of attorney is that it is good for the whole process: illness and death. But a power of attorney stops when the principal dies and the executor takes over — and the agent and executor don’t have to be the same person. Then, too, heirs come into the picture, and they can ask a lot of questions. “Families usually get in trouble because someone was not using the power of attorney properly, for example, taking funds from the account for their own personal use. And there are many cases where there is elder abuse,” says Einhart. . Keeping careful records can prevent both bookkeeping problems and bad feelings. “Make sure you have a spreadsheet of bills or a track record so no one questions you,” says Miura. Another important step is regular meetings with family members. to make them feel like they’re on the same page. Picone still worries that, at the end of her caregiving journey, she’ll somehow end up on the hook financially, especially since her friend’s estate will end up with a negative balance instead of an inheritance. The odds are high. But Einhardt says the agent doesn’t have to worry about collecting the debt by taking on the necessary tasks, especially if the agent signs everything properly and keeps good records. “The most important thing you can do is power of attorney swim Or signing everything – the principal’s name and then your name as the agent. There should be a wall between your personal assets and your major debts and liabilities,” says Einhart. One final tip: Do not keep power-of-attorney documents in a safe-deposit box. Make sure you have them in a safe place, but not inaccessible, or your agent will need a court order just to get started. Have a question about the mechanics of investing, how it fits into your overall financial plan, and what strategies can help you make the most of your money? You can write to me at beth.pinsker@marketwatch.com. More from MarketWatch
