Helping you Manage the Financial Details of Your Life



A Tale of Two POAs

This is a tale of two agents by power of attorney.

Our legal and financial advisors tell us we need a durable power of attorney for finances. With this legal document we name an “agent” who will manage our finances should we not be able to ourselves.

Some people name one agent. Others name an agent and a successor agent. I recently witnessed how the difference played out for two separate families.

Caroline named her daughter as her agent by power of attorney. Her daughter, Lilly, assisted her until Lilly had a personal crisis and had to resign. Since Caroline had not named a successor to her daughter, a social worker helped Caroline find a professional willing to serve in this role. Although Caroline had dementia, her advisors determined she had the capacity at that time to understand and sign a new POA document. As most new POA documents do, this one revoked all previous powers of attorney.

Now, a few years later, Lilly is able and willing to resume serving as her mother’s agent.  Caroline’s dementia, however, has advanced to the point where it is clear she would have no understanding of what she was signing, even if she could sign her name. Caroline thus cannot reappoint her daughter as her agent. While Caroline is now oblivious about the situation, her daughter is distraught. Lilly wants very much to serve as her mother’s agent as she believes this was Caroline’s wish. But, due to the advanced stage of her dementia, Caroline cannot sign another POA document.

Bess’ family had a different experience. In her power of attorney document, Bess named her daughter, Jean, to serve as her agent. She also named a successor, her grandson Jack, should her daughter decline to serve. Jean was serving as her mother’s agent when a tragedy struck her immediate family. Jean needed to step down. Jack then assumed this role and attended to Bess’ financial affairs. The transition was smooth.

A few years later, Jean was able to serve as her mother’s agent once again. Since both she and Jack had been named in Bess’ POA original document, when Jack stepped in to serve, a new POA document, revoking all previous ones, did not need to be written. Thus Jean’s appointment was still in place when she was ready to serve again.  She and Jack shared the responsibility until Bess’ recent death.

Since I am not an attorney, I cannot provide legal advice. I can, however, tell you the experiences of two different families and let you draw your own conclusions.

None of us can look into a crystal ball and predict what will happen in the future. But we can learn from others’ experiences and do our best to make our plans and wishes as solid as possible.

Some people named co-agents. Seek the advice of legal counsel to determine what is best for you or your loved ones. The names of individuals in this blog have been changed to protect their privacy. This blog is published to provide you with general information only, and is not intended to provide specific or comprehensive advice.  Money Care, LLC encourages individuals to seek advice from competent professionals when appropriate.