Managing finances can be difficult even in the best of situations. Some elderly Florida residents find that keeping track of money, bills, income and more gets harder with age. For these and other reasons, a person might choose to name a trusted loved one or close friend in a financial power of attorney. This is often done during long-term estate planning. These individuals have a significant responsibility to manage those finances in a responsible manner.
Keeping a loved one’s money separate is very important. This means that the person who holds a financial power of attorney should not deposit the other person’s money into a personal bank account. This can make it extremely difficult to differentiate between each person’s money, and accurately tracking outgoing bills and incoming payments may be impossible. On top of that, family members may question a person’s decision to mix finances and could pursue an audit of all activities.
A more appropriate option is to create a separate bank account for the other person’s money. The person who holds the power of attorney should generally consider creating the account in the name of the person granting the power, but rules can vary from bank to bank. It is best to check with the bank about whose name the account should be in and exactly how the power of attorney holder should sign checks. Signing checks in the relative’s name is usually standard, followed by the signature of the person holding the power, along with the notation “POA” or the phrase “power of attorney.”
An individual may feel hesitant to accept the responsibility of a power of attorney. He or she may have justifiable concerns about filling this role, such as how to best manage money in order to support a loved one’s needs and wishes. However, with careful attention to detail and further exploration of long-term estate planning, most people in Florida can successfully take on these tasks.