Home » News & Events » Safety and Planning is a Snap! with Sally Pessin
A Power of Attorney is a Must!
by Sally Pessin, Licensed Retirement Planning Counselor and Estate Planning Attorney
An estate attorney friend of mine recently shared a problem she was having. My friend’s client was a 70-year-old woman whose husband needed to go into a memory care facility. The client needed to access her husband’s retirement plan to be able to pay the hefty monthly bills for her husband’s care. However, the retirement plan administrator would not allow the wife to withdraw funds because the owner had never executed a financial Power of Attorney (“POA”). A court hearing to appoint the wife as the husband’s guardian was now necessary to access the husband’s retirement funds. This would cause the client a delay and cost her a few thousand dollars in attorney’s fees.
To avoid an outcome like the one described above, make sure your POAs are executed or updated. There are free forms on the Attorney General of Maryland’s website and instructions on both financial and healthcare POAs. Look at the “Durable Power of Attorney” as well as the Health Care Power of Attorney: https://powerofattorney.com/maryland/ To make sure that the documents are done properly, you will want to have an attorney help you to execute them.
Review your POAs each year. The people you initially appointed might no longer be available or you might have a better candidate. Even if you do not need your will updated, many attorneys will draft POAs for a reasonable fee.
Contact your financial institutions, especially banks as they all have their own POA forms that they are more likely to honor on the spot. By law, these institutions are supposed to honor a POA executed properly for that state. However, due to fraud, many banks are reluctant to comply in a timely manner and may want to run the request through their legal department.
