Samuel had done a lot of things right to live comfortably in assisted living. He worked nearly 40 years at a steady job, saved something from every paycheck by living a bit below his means, and spent money prudently. Sam was proud of the fact that he and his wife, Shirley, raised three children in a tidy and comfortable home that was full of good times and family memories.
But Sam also could tell that he didn’t have the same grasp of personal finance that Shirley had, a situation that caused him some anxiety since she passed two years ago. Thanks to the sale of their home and frugal nature, the estate had reached the $750,000 mark with investments in mutual funds and an annuity that he didn’t understand fully. Even the basic routine of paying bills by check became something he loathed.
There was another underlying fear that nagged him — none of the kids really had a good idea of the scope of the estate. What would happen if he was incapacitated by something like a stroke? At 86, he had a sharpened sense that he wasn’t going to live forever.
After consulting with his family attorney, Sam understood that it was necessary to appoint someone with a Durable Power of Attorney-Financial to start the transition on financial matters to his children. His attorney gave him a good framework of questions to gauge the experience, skills and temperament of his children to determine who may be best suited to perform that role.
His attorney advised that while the first consideration seems obvious, it is often overlooked by clients: Who had a good sense of handling personal finance and investments? The person who is appointed should have real life experience with money and show fiscal responsibility, hopefully with some experience with investment instruments.
The second consideration is geography, as some financial matters would require personal meetings spanning more than a day that would mean extended stays in Sam’s home town. Sam had already taken care of one of the biggest time commitments for the agent appointed through his Durable Power of Attorney-Financial — the sale of a primary house or other property. But anyone who accepted the role would need to review all of Sam’s files and meet with banking and investment representatives.
Finally, one of his children would need to accept the responsibility, hopefully his first pick among the three. If no one wanted the role, he could engage the services of a professional agent for a fee.
Sam’s situation worked out well. His oldest daughter had inherited her mother’s gift for finances and was experienced with investing larger sums of money as her own 401(k) grew, and she gladly accepted the responsibility as a way to relieve her father’s anxiety.