Who Do You Trust to Make Financial Decisions for You?
Trust, years to build, seconds to break, and forever to rebuild. This is especially true when it comes to our money. Even between spouses or parents and their own children, we all have a difficult time trusting each other with money. During my years helping clients with their estate planning, it is often easier for them to decide who will make healthcare decisions than to decide who they trust with their money. Who do you trust to make financial decisions for you?
Who should you trust to manage your financial well being when you are no longer able to do so? A power of attorney (POA), otherwise known as an agent to your principal (or attorney in fact), has the legal authority to represent and make decisions on your behalf. What characteristics should you look for when designating a power of attorney? No matter what type of power of attorney you seek to arrange, your potential agent must be a person you deem to be trustworthy and honorable to conduct your affairs in your best interest.
Often the principal who designates the POA may prefer to choose a family member such as a spouse or adult child. If a family member is unable or unwilling to act when needed you can name a trusted friend or retain professional representation to ensure your interests are well looked after. Some people choose to have co-agents or name a secondary agent in the event another might pre-decease you.
Stipulations regarding the selection of a POA are minimal. Your chosen power of attorney must meet two legal thresholds; be an adult and not be incapacitated. There are no special qualifications regarding financial acumen or legal knowledge, and in fact, integrity is considered the most important attribute when selecting your agent.
Some questions to consider beyond your basic level of trust with this person(s) include: