WHAT SHOULD I BE DOING IF I AM SOMEONE'S FINANCIAL POWER OF ATTORNEY?

First, you must remember that acting as a financial power of attorney involves making decisions for that person's best interests. This may seem obvious, but it is so important that it bears repeating. Thinking of another person's best interests is not always the same as using your own common sense. You often need to be more conservative and careful than you would when taking care of your own affairs.

Second, read the power of attorney document. The power of attorney document is a list of things you can do. It is like playing the game of Simon Says. If the document does not say you can do something, then you probably cannot do it. Not all power of attorney documents are alike and you need to be familiar with the rules that apply to your situation and the limits that you need to work within.

Third, keep a record of what you are doing. A power of attorney is legally accountable for his or her actions and a Court can require you to produce an accounting. This means that you should retain bank statements, bills, receipts and other documents related to what you do. You should balance the checkbook for any accounts so that your check register is up-to-date. You should also prepare a formal annual accounting that shows all transactions and activities. Even if you do not end up showing these documents, records and accountings to anyone, it will save you a great deal of time, effort and anxiety if anyone ever asks for the information.

Fourth, never use the power of attorney to do anything that benefits yourself or your family. There is a presumption that any benefit that you or your family receives through use of the power of attorney is fraudulent. If anything like this comes up you should tread very carefully and act only with qualified legal advice.

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