MSU Extension discusses financial power of attorney during COVID-19 pandemic
BOZEMAN — If a person falls ill during the COVID-19 pandemic, many questions may need to be answered about their finances. Montana State University Extension educators suggest creating a financial power of attorney to help protect a person’s assets if they are hospitalized.
A financial power of attorney can ease the burden of making financial decisions for many reasons. For example, an elderly mother can sign a POA to designate her child to pay bills, write checks and pay for groceries or prescriptions on their behalf.
According to Marsha Goetting, MSU Extension family economics specialist, and Wendy Wedum, Pondera County Extension agent, creating a financial POA is easy thanks to the Montana Uniform Power of Attorney Act. The law protects the person who gives the power, or principal; the person or agent, who is authorized to make decisions on behalf of the principal; and those who rely on the POA authority like financial institutions and businesses.
The law also includes a form for a financial power of attorney. And while that form may work for many Montanans, those with complicated finances or special circumstances should consult an attorney.
Though the Montana Uniform Power of Attorney Act lists an agent’s duties and specific authorities, the details should still be discussed. “You want to be sure the agent understands what financial actions they can take care of on your behalf,” Goetting said. “Also, consider the distance and amount of time needed to perform the duties, which might be simple or complex and time consuming.”
A challenge for parents with more than one adult child may be who to name as the POA agent. Wedum said because parents do not want to play favorites, they often name two or more children to act as co-agents, thinking that solves the problem.
“Before deciding to give authority to more than one agent, consider the potential consequences if your co-agents disagree about an action to take on your behalf,” Wedum added. “Such disagreements may cause family feuds that, if the district court becomes involved, may result in large attorney’s fees and court costs. Talk to your children about your choices, your financial goals and the responsibilities you expect them to assume.”
A financial POA can also be a low-cost option to a court-ordered guardianship or conservatorship. However, before deciding to sign one, individuals should consider the risks and appoint an agent and successor agent who are knowledgeable about finances and are trustworthy, Goetting and Wedum said.
For more information, request the MSU Extension MontGuide “Financial Power of Attorney” at tinyurl.com/ybje6akg. For those who do not have computer access, copies are available from county Extension or reservation offices.