It is an honor for a family member or a trusted friend to ask you to serve as their power of attorney. It means they trust you implicitly and believe that you are qualified to look after their financial and legal affairs. However, as discussed in Next Avenue’s article, “Saying ‘No’ to Power of Attorney Duty,” not everyone should say yes to serving.
This is no small job, for one thing. It requires time, including appointments with attorneys, CPAs and financial advisors, a fair amount of paperwork and a legal and ethical responsibility to undertake the task. If the family members are challenging, you’ll also have to stand up to them.
Once you have accepted the position, you are known as the “attorney-in-fact” or the “agent.” You are acting on behalf of the person, who is referred to as the “principal.”
While there are several combinations and varieties of power of attorney, there are two common ones. General durable power of attorney, also known as power of attorney for finances, allows the named agent to act on behalf of the principal to take care of that person’s finances like banking, paying bills, or selling a house. Health care or medical power of attorney allows the agent to make health care decisions, in the event the principal is incapacitated.
A common misconception about POAs, is that people think that if they’re named as an agent on a POA, they’ll wind up owing money for the principal’s unpaid medical bills. Not so. An agent is merely acting on behalf of another person, not making themselves personally liable. However, there are other reasons a person may want to decline being named power of attorney. Ask yourself these questions, when considering whether to commit to being someone’s power of attorney:
- Can you drop everything for weeks or months and make critical medical decisions if this is a power of attorney to make medical decisions?
- Do you have the emotional strength to make hard, life-and-death decisions?
- How is the family dynamic? Do you have a sibling who’s quick to anger or who could be suspicious of your motives when it comes to medical or financial decisions?
If you’re not up to it, and the person who appointed or plans to name you as POA is still capable, it’s best to talk directly with that person about your concerns. Be honest and let them know how you feel.
The possibility of a POA not being able to serve is highly likely, and that’s why everyone should designate successor agents. These alternates in a POA can cover the inability, or inevitability, that someone may not be able to serve.
Telling someone that you cannot take on the duties of the POA before anything occurs, is far better than saying yes and then backing out. Be honest and forthright. There may be hurt feelings, but that will pass.
Reference: Next Avenue (September 11, 2018) “Saying ‘No’ to Power of Attorney Duty”