Becoming someone’s agent under a power of attorney is not something to be undertaken lightly. It is an enormous responsibility that can potentially become a stressful and time-consuming duty.
So what exactly is a POA? When you are designated as a power of attorney, you are given the power to make decisions on behalf of the “principal” (the person executing the power of attorney) in case the principal should become incapacitated. Your role as the agent is to make choices and take actions to manage the principal’s affairs based on what you believe the principal would have done themselves. In other words, put yourselves in their shoes and act as they would on a situational basis.
What is a power of attorney?
A POA allows you to take investment and spending measures for the principal, including tasks such as opening bank accounts, withdrawing bank funds, trading stocks, paying bills, and cashing checks. A POA can also give you the power to make certain legal decisions. You are not personally liable for the principal’s bills, but you are able to manage all the details of getting them paid. In some cases, a POA can be implemented by healthy parents or other family members who simply want someone else to be able to help them manage their personal affairs. In either case, it’s imperative to keep consistent and detailed records of all transactions and other interactions.
Before you say yes
While you might be flattered that a friend or family member trusts you enough to ask you to take on the responsibility of acting as an agent under a POA, it’s important to consider the situation carefully.
Here are some things to consider:
- Do you have time in your day-to-day life to take on the responsibilities of being an agent of a POA? People sometimes assume that the role of an agent is limited to a few major decisions, but every so often it expands to cover an ongoing list of day-to-day tasks. Do you have enough time in your day to make and document calls, write checks, make electronic transfers, and anything else that needs to be done?
- Could you step away from your life—perhaps for an extended period of time—if necessary? Depending on the complexity of the principal’s situation, there may be scenarios in which you would need to put your life on hold to manage certain affairs. What if the principal is on the other side of the country? Now travel expenses and extended time factor into your life equation.
- Do you have the skills to fulfill the role? There are certain cases that may require more expertise than you can offer. Do you have the money management skills to properly take care of the principal’s affairs and estate?
- Are there inter-family relationship issues that might come into play? Sadly, it’s not unusual for siblings to disagree over the best decisions to make. The person acting as agent under any kind of POA must be able to manage family relationships well. If you were acting as an agent, how would that affect your relationships with other family members?
If you decide to say no
In the best case, the person executing the POA will be preparing these documents well in advance of any incapacitation, and will ask beforehand if you would be willing to take on the role of agent under a POA. Take that time to ask yourself the questions outlined above.
If you decide that you are not comfortable saying “yes,” have an honest discussion with the principal about your reasoning. You can simply explain why you are not the best person to act in the role.
If the principal has already appointed you as the agent, rather than declining, you will need to resign. The POA document will specify the steps to resign. If it does not, a good first step is to write a letter tendering your resignation, and send it via certified mail to the person who executed the power of attorney and any co- or successor agents.
If the principal is incapacitated when you are informed that you have been appointed the agent under the POA, things get a little more complicated. Ideally, the principal will have named one or more successor agents. Successor agents are people who will serve as agent if the first person named cannot serve because they are deceased, incapacitated themselves, have resigned, or are refusing to act.
If there are no successor agents, a guardian may need to be appointed for the principal. In such cases, another family member or friend can petition the court for guardianship. If no one steps forward, the principal may become a ward of the state.
When in doubt, consult an attorney
Saying yes to a loved one who asks you to become their agent under a power of attorney may feel like the right thing to do. However, it’s not a decision to be made lightly. For your sake, and for the sake of your loved one, it’s important to take the time to give the question very careful consideration.
We can help you understand exactly what would be involved, and also suggest alternate or complementary solutions that might be a better fit for you and your loved one.
So if you’ve been requested as a POA and you don’t want the responsibility, remember, you can say no!
If you have questions, feel free to email, or call us at 860-236-7673.
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