A durable power of attorney document appoints someone to act in your place if you are incapacitated. The POA is allowed to take whatever investment and spending measures which he or she believes the principal (you) would take on your own behalf, including:
- opening accounts
- withdrawing funds from accounts
- trading stock
- paying bills
- cashing checks
- selling assets
- buying assets
In most cases, a POA agent is a family member who does not expect to be paid at all. But, if the principal agrees to pay the agent, that should be agreed upon ahead of time and put into the document itself.
The Consumer Financial Protection Bureau, which has a special federal Office for Older Americans, published the very useful handbook “Help for Agents Under a Power of Attorney”.
On our Geyer Law website, we emphasize how central a role your General Durable Power of Attorney plays in your estate planning. “Without a Power of Attorney in place, your family’s only option is to obtain a legal guardianship over you to handle financial affairs in the event of your incapacity.”
You may or may not choose to provide “reasonable compensation” to your Power of Attorney Agent, but the Power of Attorney document itself – that’s a priceless piece of your estate plan!
- by Rebecca W. Geyer