How to get Dad’s permission to help with his finances, and the needed legal docs

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Q. My dad is getting older, and not just older, but forgetful. He lets me help him with his finances — sometimes. What should I do to make sure I can continue to help him if he’s unable to do things for himself?

A. It’s a tough topic, but it’s so important to have conversations like this with older loved ones.

You should discuss with your father his present estate planning documents, which may include his will, Advance Directive for Health Care — also called a Living Will — and Durable General Power of Attorney, said Catherine Romania, an estate planning attorney with Witman Stadtmauer in Florham Park.

She said if your dad doesn’t have any of these documents, or if they were executed more than five years ago, he should consult with an experienced estate planning attorney to have the documents prepared, or to review any existing documents to determine if changes are required or recommended.

“Depending on your father’s financial situation, an estate planning attorney may have other recommendations to reduce taxes that otherwise may be incurred upon your father’s passing or to best manage your father’s financial assets in order to qualify for certain forms of government assistance, such as Medicaid,” Romania said.

In order for you to assist your father with his financial affairs, especially if a time comes when he is no longer capable of handling them himself, you should be named as his agent or attorney-in-fact on his Durable General Power of Attorney, she said.

“It is possible that your father named an agent for one or more of his accounts on forms prepared by the financial institution holding such accounts,” Romania said. “Although being named as agent with respect to such accounts allows the agent to direct investments and/or make payments or transfers from the account, it does not give the agent other broad powers which may be required to assist with financial affairs, such as taking out loans, executing tax returns or selling real estate.”

She said a properly prepared Durable General Power of Attorney provides these types of broader powers.

If your dad doesn’t do this while he’s competent to do so, there could come a time when you need to go to court for the appointment of a guardian. The procedure for appointment of a guardian is more time consuming and expensive, as well as more emotionally difficult, than simply ensuring an agent is appointed, Romania said.

“Finally, while able to do so, your father should prepare a list of his financial accounts and other substantial assets and debts, as well as any user names and passwords for the accounts, and direct you to the location of important documents,” she said. “This will assist you in helping your father during his life and assist the executor of your father’s estate upon his passing.”

Now we know this conversation may be a tough one to have, depending on your dad’s feelings on the matter and his intentions for his estate.

So you may want to tell him that a power of attorney is not forever set in stone.

“The principal who creates a power of attorney can revoke it for any reason and can continue to manage their finances so long as he or she has the mental capacity to do so,” said Shirley Whitenack, an estate planning attorney with Schenck, Price, Smith & King in Florham Park. “If Dad’s forgetfulness will cause him to take unwise actions regarding his finances, he may benefit from the creation of an irrevocable trust to hold his assets.”

That trustee could be you or anyone he believes will look out for his interests.

Whitenack recommends he see an estate planning or elder care attorney to make sure he gets customized attention.

“While these documents can be downloaded from the internet or purchased from office supplies stores, such documents may not include important provisions,” she said.

Better to be safe than sorry.

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This story was first posted in February 2015. presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.