John R. Bullis: Serving as fiduciary is a big and valuable job
You may be asked to help handle the finances for your parents or another relative.
That is not an easy job, and it might be in addition to making health care decisions and/or serving as a caregiver.
If you are named in a power of attorney for financial matters, you have a new title: “Fiduciary.” That means you need to do the work and decisions correctly, always remembering it is their money, not yours.
First read the document carefully; reading it out loud may help your understanding. Sometimes you can involve the loved one in understanding what it means.
You will avoid any conflicts of interest by not lending to yourself or others. The money is for the individual’s care and best interests. Of course you should avoid the temptation of using any of the money for your personal benefit.
It is important to keep a detailed list of what the loved one owns and owes. Make a note of the insurance policies and when the premiums are paid. You will probably benefit from talking with the insurance agents and looking at the various coverages. If the car is no longer needed, maybe it could be sold and the insurance canceled.
The titles on the real estate and vehicles should not be changed. It is best to keep the titles in your relative’s name and be sure to avoid setting up any joint ownerships.
We have found the banks are willing to set up the existing bank account(s) so the ownership is still in the loved one’s name, but you are an “authorized signatory” — you can write checks on their account. The owner (the relative) will need to approve you becoming an authorized check signer, but if they can go to the bank with you, that is fairly easy to set up. Take your power of attorney form with you to the bank.
You need to keep a detailed record of what monies are received and what is spent on behalf of the loved one. Please consider not paying cash for anything. The key is to have documentation of all transactions. Credit cards are good for doing that, but you still need to keep all the statements and receipts.
A diary or journal is a great help, and not only for keeping track of the money transactions. It can be important for being sure the health matters are documented or listed so the doctor or nurse can see the important events, etc.
In this day and age, it is important to watch the credit card statements for unexplained charges. Follow up and get the details of any unexpected charges.
Your work in this is important and can comfort and protect your loved one.
Did you hear? “Trees are poems that earth writes upon the sky” — Kahlil Gibran