FAQ About Power of Attorney

 

If you want your agent to have access to your bank account, be sure to get your bank's authorization form and a signature card for your agent. Usually a bank has its own form to give your agent access to a particular account. If you don't contact the bank before you become incapacitated, the bank may not honor checks and withdrawals that your agent signs.

 

Giving your agent the authority to have access to your bank account is not the same thing as making a friend or relative a joint owner of the account. You'll want to make sure that you create the right kind of account so your agent has access to your funds but is not listed as an owner.

 

State laws vary as to whether they penalize a third party, such as a bank or brokerage, for refusing to honor a power of attorney. The best answer to the question is to avoid the problem by being prepared. Once you've signed a power of attorney, contact any financial institutions where you have accounts, safe-deposit boxes, securities, and the like. Give the firms copies of the document and ask whether they have any questions or whether you have to sign other documents, such as authorizations or signature cards. Taking these actions, you can generally avoid any difficulty.

 

No one can tell you whom to choose as your agent. The person you choose needs to be someone you trust and someone who can do the job. It is best to avoid someone who is ill, inexperienced in financial matters, has a hard time managing their own money, or for some other reason wouldn't be able to handle the responsibilities. Between two equally qualified persons, the one who lives closer to you is generally the better choice.

 

The law permits you to appoint co-agents. However, that may not be a good idea. To make decisions, the two must agree. If they disagree, they may have to go to court. This is really expensive, time-consuming, and defeats the major reason for having a power of attorney. If you have two equally qualified persons to choose between, you may want to name one as your agent and the other as a substitute to step in if your first choice cannot serve. You could also appoint one to make financial decisions and the other to make health care decisions. This is your choice. Do not allow yourself to be talked into selecting anyone other than the person you want.

 

No! Your will determines how your property will be distributed after you die. Your executor has no authority to act before your death. Your power of attorney deals with how to manage your property during your lifetime. On the other hand, your agent has no authority to act after you die.