Power of Attorney, Estate Planning, Revoke, Bank Account, Financial Affairs, Revocation, Advanced Medical Directive.
What To Do When… You Need a Power of Attorney.
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WTDW Podcast | Episode 46: What To Do When… You Need a Power of Attorney.
What To Do When… Intro 00:01
Welcome to What To Do When… A podcast from real lawyers with real perspective, where we explore a variety of legal issues and scenarios. Each week we focus on a new topic and discuss what to do when and if any of these legal scenarios ever happened to you or a loved one. With over 40 years of combined legal experience, our hosts offer their unique perspectives and insights on a range of real life legal situations.
Jackie Critzer 0:29
Hi, and welcome back to the podcast here at Critzer Cardani. In Richmond, Virginia. I’m Jackie…
Scott Cardani 0:35
I’m Scott. We’re here today. Jackie, what’s on the docket for us today?
Jackie Critzer 0:39
Power of Attorney What to do when you need a power of attorney.
Scott Cardani 0:43
Yes. Power of Attorney. What does that mean?
Jackie Critzer 0:47
What does it mean? What doesn’t it mean? What does it do? Who is it good for? How long does it last are so many questions. And what we’ve noticed that this is a highly searched issue. So let’s start with what is a power of attorney? What does it do? So I fully capable of making decisions for myself, I’m in my right mind. But I want to give Scott power of attorney that means my attorney in fact, not my not my counsel, but my the person who can stand in my shoes for me at the bank filed taxes.
Scott Cardani 1:16
So it’s not an attorney.
Jackie Critzer 1:17
So it’s does no it’s not an attorney power of attorney is not in fact, an attorney, you happen to be an attorney, but it does not require such things. And what it does is it gives got the ability in my case, it would give him the ability to do things for me, let’s say I was going on a missions trip. And I was going out of the country for a bit of time. And he’s got to take care of maybe the bills, paying my bills, and he needed access to my bank accounts. Well, now he’s going to have the power of attorney. It’s a form, it’s it’s very clear, it outlines what powers I’m giving him you don’t have to I don’t have to give him all the powers, I can give him a few bank accounts, maybe I just want to limit him to the to the bank accounts. But maybe I want to give him power to buy and sell real estate or to file my taxes for me, I can pick and choose the powers that I want to grant to Scott, in the event that I just can’t do it myself.
Scott Cardani 2:09
And that’s really important, folks. And when you are talking about a power of attorney, you really need to be specific on what you want. A lot of people write real general power of attorneys for me, like Jackie, I can do all kinds of things that she didn’t know I could do. So that’s why you really need to get somebody involved to help you walk through what is what is the reason you believe or you believe you need it for your grandmother or your uncle or your aunt, what do you need it for? And what are you trying to do is really important questions that you need to answer.
Jackie Critzer 2:36
A lot of times we see a power of attorney in an estate planning package. So you maybe do a will last will and testament power of attorney and an Advanced Medical Directive. And you do that power of attorney. It’s a durable power of attorney and it’s just in case, you’re really not able to make decisions for yourself or you are unable to get out of the house. Maybe you become homebound, or for whatever reason you can’t handle your own affairs, that’s fine. That’s that’s certainly a good purpose for it. But there was even another purpose, you might have a young person in your household going off to college, and you need to be able to handle their financial affairs at their bank without being on the bank account with them. It’s still their account. But you could have power of attorney to help them maybe pay make car payments or deal with their credit union or do with a bank, help them file taxes. But that’s that’s certainly a popular use of a power of attorney is for a parent or a child. It’s not necessary power of attorney isn’t necessary. But what you don’t want to have happen is that you need something done, you’re not able to do it and no one else can do it for you. Now, what do you do? So operating through a power of attorney does require the original document. So Scott would take that document, he’d go to the bank, he’d say, Here you go, here’s the original, the most of the times they don’t want to see a copy of this. Sometimes they do and it’s not a big deal. But you take the original and then the form allows him to take care of things for me. But there are some restrictions and some extra responsibilities that come with a power of attorney. And that would be that’s called a fiduciary responsibility. So it’s not just oh, hey, he took me money and he bought a boat instead of for himself, not for me. Take her out on it at my ask. Is that bad? Can it get in trouble? It’s not just bad. It’s a crime. He’s it’s a breach of fiduciary duty. It’s really embezzling from from me, even though he had the power of attorney he had the ability to access that funds to access those funds and he could buy himself a boat. He is required by operation of this document to to do things that he’s been given permission to do or that in my best interest. Certainly not him buying a boat for himself is not in my best interest. Probably. And so you so you have to consider who it is you might want to make your power of attorney.
Scott Cardani 4:53
That’s very, very important. You know, those things are very important. You have to have a level of trust. I don’t you know, we I actually handled both sides of this, we’ve handled the actually creating a power of attorneys for people. But we’ve also had have had the criminal side of it where somebody maybe have at least been accused of overstepping their bounds of power of attorney. So it’s really important, as Jackie said that, you follow in that ethical kind of understanding that you’re there trying to help that person if you’re going to be that power of attorney. And when you’re looking for a person to be your power of attorney, you want to have somebody that you have some pretty good trust. And the bottom line is in life is when money’s involved. Some people, even good people make bad decisions. So you really got to think through that it’s not just a willy nilly, I’m in a bad shape, I’m going overseas, I need to get somebody really quick, it can really be a bad situation – quick.
Jackie Critzer 5:44
I think a lot of people to get confused about when a power of attorney ends, it does not survive death. So if Scott has power of attorney, I’ve given him power of attorney for me, and then I die, so does his power of attorney, he doesn’t then still have authority to use money in the bank account to go do things for the estate that would be taken care of in a will and a lot of people get confused about that and think, Well, I have power of attorney, then I have it even after death. And that, in fact, is not the case.
Scott Cardani 6:13
And then you’re again, you’re in a position where you’ve committed a crime, potentially by exercising authority you don’t have so very careful a lot of people, you know, a lot of crooks will try to use that as a means while they get the power of attorney while you’re living. And then quickly, right after you die, they’re running the banks and draining everything they can before things get noticed. So that’s really important. But So Jackie, I have a question. So you gave me power of attorney? And then you don’t like me? How do you get rid of it?
Jackie Critzer 6:42
Well, one, and I say no more power of attorney, no more power of attorney. No, I can revoke it. And I can revoke it in writing. I mean, I suppose I could tear it up in front of your face, but I need to revoke it in writing and and notify you and then what else should I do? Scott?
Scott Cardani 7:03
Well, obviously, if you have institutions that may they may be using it, I would send copies to the institution say there’s no longer a power attorney for me, you know, like your bank, anything that you were, especially specific power attorneys that you had it for a specific reason, you can really narrow into that make sure everybody’s everybody who could be potentially using that power of attorney or being used by them.
Jackie Critzer 7:28
well, and just to be protective of your own affairs, if even if I knew Scott was using my Bank of America account to buy his boat, but he had access to my Wells Fargo and my Chase and my local credit union as well, I’m likely going to send the revocation to all of those institutions, just to protect myself, I might even send it to a credit bureau and put them on notice. If there were credit applications coming in, I would certainly put a flag on my my credit bureau status to make sure that that I was taking extra steps to be cautious because once you revoke it, the bank if he was using Bank of America and had been doing so under the law and was allowed to do so they wouldn’t know that I’d revoked it unless I told them. So you want to make sure that if there is a revocation that you notify those that that may or may not have been used by your power of attorney, but certainly all of the folks that you all have the institutions you personally do business with.
Scott Cardani 8:29
Yeah, I think the other issue too, is something you’ll run into, we ran into a lot is some institutions don’t want your power of attorney written by Jackie, they want their own little power of attorney. And I’ve always found that a bit offensive to be quite frank, because I don’t think they should have the right if you go to a lawyer and get a power of attorney drafted up that should be golden anywhere. But a lot of institutions have their own internal rules and make you do that. But the reason I bring that up is twofold. Number one to let you know that you might want to, for instance, if Jackie scenario that I’m becoming power of attorney to pay your bills, and it’s Bank of America, and you go pay Jackie to or Jackie, pay somebody else to draft that. And that’s not good. So one of your initial inquiries should be the institution that you want to use the power of attorney with, do you accept our power of attorney? And they may say no, we have a form yet to fill out. Secondarily to that, though, is what Jackie just said, you may have done a power of attorney at some institution for very temporary and forgot about it. Try to remember those things and make sure you revoke that in writing with the institution because that can still carry, you know, maybe you did it for, for instance, Jackie may have been pregnant or something recently and had to be in a hospital or something. And she gave me power of attorney for that short period of time. The one of the institutions we did it with we did a form for instance, it was Bank of America needed a form and she forgot to revoke that. And then six months later, I still remember it’s in place and I go to Bank of America and start withdrawing funds, maybe $2 at a time and you know, whatever it is, but my point is I was at a time Yeah, so the point is you got to really be careful with power of attorneys, you have to be mindful of them everywhere you put one in, you better have a copy of it, be very mindful of it. Because when the day comes that you don’t want that power of attorney anymore. And I think for elderly people, there comes that point where maybe they come under the care of the state or the Care have a, you know, a person who’s taking care of them. You know, all those things have to be considered. So if your family member wanted to she have any power of attorneys out there that we need to revoke now, because she’s no longer able to care for herself and who’s taking care of it. You know, to get the…. em what’s the word I am looking for. Somebody who takes care of…
Jackie Critzer 10:39
Like, just a caregiver or when they go into hospice, or if they’re into any, if they just are unable to take care of their own affairs, certainly checking to see if they have outstanding powers of attorney is important. So our takeaways today, first of all, what is the power of attorney it’s the grant of authority to another person, not an attorney, but to another person to operate for you stand in your shoes and to take care of financial affairs for you. Again, that’s open a bank account, close bank account by house, so House file taxes, and many, many other powers are available under a power of attorney. So that’s what it is. When do you need one? Well, sometimes you might need one for a young adult who’s just going off to college so that you can help them manage their affairs while they’re gone. It might be just a spouse, one spouse to another here you have power of attorney, you have the authority to stand in my shoes and do things one for the spouse. And then when you’re older, and when you’re doing your your estate planning documents when you’re doing your will and your power of attorney and your Advanced Medical Directive. In the event that you you become unable to care for your own affairs and you want someone trustworthy to stand in your shoes. That’s another time. So there’s lots of times in life that a power of attorney could come in handy. And then finally, how does it end? First it ends when you die when you die, your power of attorney dies, the person can no longer act on your behalf. Once you have passed away. It also ends when you revoke it and remove their authority and their power from using the power of attorney.
Scott Cardani 12:07
And remember to do that in writing.
Jackie Critzer 12:10
Everything in writing.
Scott Cardani 12:12
Well, thank you for joining us today and we enjoyed this time. Make sure you like and subscribe and we’ll be coming to you soon with another podcast.
Jackie Critzer 12:19
What To Do When… Outro 12:21
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