E309 Limited Powers of Attorney for Solo Agers

<p>If you’re a solo ager and you must use a power of attorney (POA), make it as limited as possible.</p> <p>We received the following from a solo ager listener: “You state in your book that a financial power of attorney is not necessary if there’s a solid living trust in place. (I don’t feel the risk of abuse is a critical concern in my case). However, my lawyer says I need to name one.”- Lori</p> <p>This attorney refused to complete our listener’s estate plan unless she included a financial power of attorney.</p> <h2>Why I avoid POAs whenever possible</h2> <p><img class="aligncenter size-medium wp-image-43540" src= "https://anthonyspark.com/wp-content/uploads/2023/02/Why-I-avoid-POAs-whenever-possible-300x169.jpg" alt="Why I avoid POAs whenever possible" width="300" height= "169" /></p> <p>Powers of attorney are very overpowered. It can be executed with just a simple notary with no witness requirements. But, for that basic execution, there is unlimited control over someone else’s finances, house, etc.</p> <p>Powers of attorney are pretty unstructured. There are no guide rails in the law for how an agent under the POA is compensated or whether there should be an <a href= "https://anthonyspark.com/e294-how-to-close-a-probate-estate-in-new-york/"> accounting proceeding</a>.</p> <p>Besides, if you have a revocable living trust, then you have most of the benefits of a power of attorney. You would only need a POA if you are traveling abroad or incapacitated. You’d need someone to manage the funds on your behalf so you don’t fall into arrears or foreclosure.</p> <p>I don’t think the risk of having a financial power of attorney is worth covering those outlaying scenarios. If you ever read a standard power of attorney, you’ll see that the agent has the power to do almost anything with your finances and property.</p> <p>A supreme example from the news headlines is of Brooke Astor, a famous New York philanthropist. Her son was able to siphon about $80 million from her estate with a simple POA, contrary to the rest of her e