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Power of Attorney Benefits and Pitfalls

Finishing Well / Hans Scheil
The Cross Radio
December 4, 2021 8:30 am

Power of Attorney Benefits and Pitfalls

Finishing Well / Hans Scheil

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December 4, 2021 8:30 am

Hans and Robby discuss why having a Power of Attorney is important. They also look at the benefits and issues that come with POA's

Don’t forget to get your copy of “The Complete Cardinal Guide to Planning for and Living in Retirement” on Amazon or on CardinalGuide.com for free!

You can contact Hans and Cardinal by emailing hans@cardinalguide.com or calling 919-535-8261. Learn more at CardinalGuide.com.  Find us on YouTube: Cardinal Advisors.

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More importantly, it opens the door to talk about Jesus and nothing says Christmas better than that. Join Truth Network in supporting gospel for Asia gift today@truthnetwork.com and click on the Christmas critter campaign because this Voyager man talk radio podcast. Our mission is to break down the walls of Bryson's nomination, your chosen truth radio broadcast will be starting in just a few seconds. Thank you. This is the Truth Network welcome to finishing well brought to you by Cardinal guy, certified financial planner long shy best-selling author and financial planner helping families finish well over 40 years of finishing well will examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing Medicare IRA long-term care life insurance and investments and taxes. Now let's get started with finishing well, finishing well is a general discussion and education issues facing retirees.com partner advisors on trial CFP some insurance this show does not offer investment products or investment advice welcome to finishing well certified financial planner Hans shy all in today's show is power of attorney benefits and pitfalls of the reason I'm laughing as I can't help but think of of the first pitfall we know about the Bible which was Joseph, which unfortunately as it turned out, God gave him a power of attorney over his brothers. ED showed him in a dream and I got them in the bed as you know the story is brothers email they found out about this power of attorney had the nature of the workouts are good. It didn't appear as it turned out right when the famine hit whatever they are out of food and all of a sudden this power of attorney kicked in the near and dear embed me right is a fascinating thing on I just you know for my delight and hopefully you'll see the beauty of it is that Joseph in so many ways is a picture of Christ, right, I mean we started that literally spiritually. If it weren't for our brother who you went ahead of us on Justice fix the tell most famous words that we know Joseph said to his brothers what you meant for evil God meant for good, right before he said that he says shalom to you right out shalom out again it's it's like saying peace unto you the first time that's ever said is when it when Justice fix the tell his brothers.

Hey guys it's me so Jesus uses this exact term terminology with the disciples when he is just been resurrected.

They don't have to recognize them just like Joseph's brothers didn't recognize him, they were 11 in the room similarly to the 11 brothers right because Judas wasn't there and one of the very first words Jesus says to those guys when they don't recognize him is exactly the same thing that Joseph said it was everything's good piece shalom unto you. The great ideas, work had in the Christmas right to be thinking right peace unto you, and so when it comes to this idea of power of attorney, we just tell you from having some experience with it and my friend here certainly being the goad that is to get me to do it with my father and down my own case is you want peace when you got a bad situation. Wow. Can a power of attorney do that.

So take away Hans. We talked about these on shows in the past, but we haven't narrowed down on the whole show on the two powers of attorney that I think everybody walking the planet so good news here is if you're a married couple your power of attorney.

Your first power of attorney is going to be your spouse and vice versa so and if you're married couple and you don't have these powers of attorney. Your spouse is going to be able to dig through some stuff better than somebody else would. In other words, a married couple can get away with not having they should be doing a lot of things is for without power of attorney so that's that's good news if you're married, but one of you dies before the other. Now you you did these documents years ago. Now you're a single person even if I'm incapacitated, I'm interested. I got a question so I have a Roth IRA and that's in my name only son into everything correct.

Right now she's the beneficiary of that Roth IRA. However, let's say I become mentally incapacitated and also the stock market starts to crash and whatever and something to happen with with that power of attorney help her in getting into that absolutely in fact she didn't have a power of attorney. She does but if she didn't like out. She can't touch that yeah I your IRA. This is a place the spouses need to have powers of term concept was a good question was a wonderful question and it's a wonderful point because the only person that can mess with your IRA as you, your spouse can't go in and change your IRA unless they have a power of attorney never power of attorney England's act as you and it's necessary for required minimum distributions you have to actually make the distribution and if you're mentally incapacitated and you can't sign and you can't make a decision and you don't have a power of attorney. We have been a problem.

Time for the goad folks.

Yeah, I think this is an example response yeah because I mean you point that out and IRA shows so well that you can't have a joint IRA IRA is in your name for life right after Luther Roth of traditional and there's things that need to be done.

If you're in bad health and middle-income test they will probably not want to make some withdrawals out of this IRA to pay the bills and we can even do that unless we go, a power of attorney grant to go for a guardianship so that that's one of the underlying deliciousness sales points of the goad.

Here is what you're really avoiding by having a power of attorney is if you get into the position where you're mentally incapacitated.

You just can't make decisions for yourself. The only way somebody's going to be able to do them for you is there and have to petition the court for guardianship whole bunch of problems with a guardianship number one is as expensive then the next thing is you got approve. Now it's some other person proving you're mentally incapacitated and you you may not flavorless of got approve this person needs to have a very hot as I live this in real time because the goad my friend Hans told me I need to get this to my dad that I needed to know. He needs to get these power of attorney so before he got sick before he became mentally incapacitated to some extent right. We had this in place at a power of attorney.

All right, not long after my father fell alarm company that I won't name came in and saw my dad a crazily expensive like oh my goodness he had a perfectly good alarm system exceed always got a $12,000 alarm system.

He doesn't know because he is quite up to speed mentally as he normally would be paid anything for it is like sunlight. My payments on the certainly less on the one my I'm like all dad they charge you $12,000 to credit card.

No they didn't. I said all you related. My dad wasn't in any position because he been a hospital in hospital to fight with the alarm company right but praise God I had a power of attorney. I moved right in that you know in and it took me a couple months in in in some effort to basically save my dad out of his estate $12,000 for what had happened because at that moment. Of course, the power of attorney came in handy. Also to different places before the end of the game. That particular case.

All my goodness and in my dad would not of sat still for me going after guardianship. Now heat what he would do. He wouldn't have. And even if he would've stood still for this number one it's not him agreeing to it is, it's the court, looking at him and auditioning him to see. Does he need to have one or somebody can come in and testify because he can't come into the court then the next thing you got approve is your you're the right person for you if you're the son or daughter. Here you you you got approve not only does he need one, but I'm the person that you want to make the guardian then you got the problem are there competing interests year which a lot of times in the situations like this.

There's another brother, another sister or cousin or spouse or boyfriend or girlfriend just did just all kinds of people can come of the court say no. He needs a guardianship but don't put Robbie in charge, but somebody else in charge, so a guardian deal is this something you want to avoid son back to the point is you need to sex okay and now start talking about who you put down as your is your power of attorney okay and you're really going to need to put down one and it's best if you put down a backup respect. So if what you said before, if you're married, your spouse is going to be the other Guardian of the first guardian on your thing and then you do vice versa. But then now the second person is the long-term first person because your spouse might be deceased, and then who was number two is now number one you need to make sure you pick the right one. Okay, we did a little exercise before the shower and I just said Robbie had three children and does it come to you immediately. Like who, out of the three out of the your power of attorney and he said yeah this is where we run into a stumbling block, especially with a lot of mothers sometimes fathers to their having to choose one child over the other.

So your forcing them before it's needed. I'm forcing I'm goading them is a better way than forcing them to make a decision just with a lot of you folks is that one of your children is clearly a better choice to handle your money than your second child and and there's lots of factors and that you know completely and I know what I think part of the factor in me was that's a certain burden that I saw came on me because I was my father's power of attorney so I was selecting it between my kids in on some of my kids handle burden of sure differently than other of my kids handle burden and so it's not just a matter of which one would be the most responsible which one would do the best job, but which one is what I lovingly want that.

Here it is no way or shape or form going to resent that my parents did this and and now I'm stuck doing this and any others all sorts of factors that that go into a lot of prayer really the problem here is the fact that you gotta make that choice okay then if you just have two children, then we do have to make the treasure you have one child, then there much of a choice you make, but then you need to decide is again be your Childers again be somebody else needs to be somebody younger than you simply and but still, you need an alternative to make choices. But the biggest place. I run the problems of people have more than one child or two or three kids were taught about picking one of them and that causes stress on the person vision. I have to tell these people right away.

You just need to name them and go over that it is advisable to tell him. But if you think that's going to cause you problems or angst. Yeah so today show is power of attorney benefits but also for fostering and analysis isn't as we move on in the show.

This is one of the things that I really love is in really Hans's ministry of helping people. He obviously is a make a dime off that this saying is just saying here is something that comes in really really handle well if you're going to finish well which is in his book the complete cargo guide to planning for living retirement.

Certainly there's a video. As you might imagine that Cardinal advisors you know on YouTube again in a power of attorney.

Benefits and pitfalls.

So we come back to talk about a few more benefits and certainly we have a look at some other interesting pitfalls.

But this critical part of finishing well from my standpoint, not leave your family and alert with you in The right.

Hans and I would love to take our show on the road to your church, Sunday school, Christian or civic group. Here's a chance for you to advance the kingdom through financial resources and leveraging Hans expertise and qualified charitable contributions veterans aid and attendance IRA Social Security care and long-term care. Just go to cargo guide.com and contact to schedule a live recording of finishing well your church Christian or civic group. Contact time that Cardinal guide.com that's Cardinal guide.com welcome back to finishing well, a certified financial planner Hans Schild today show or talking power of attorney.

Benefits and pitfalls. We are talking about, you know, one of the interesting challenges and who is your power of attorney going to be and were still under the benefits and convince you if you just want know my recommendation is this get power of attorney and you actually get to get a financial power of attorney worded very similar pretty much the same person the same thing that a healthcare power of attorney around healthcare decision site. You need to and then what we've also if you're married, then your first person named on there's going to your spouse and vice versa whose can be named second or if you're single whose can be named first. Typically that's one of the children. If you only have one child, then this can be that child. We probably still at it compared to somebody else like a niece or nephew were very dear friend. You need to be somebody younger than you. That's one of the benefits of children and if you do get in a position where your mailing address stated, you're not able to make sound financial decisions you not able to care for yourself. It's just natural for the children to be the person that can step in and do this in one of the main reasons you want to power of attorney as you don't want to put your family in a position of having to lobby the court for guardianship and add that drama to what is already a very stressful situation work summaries. Gotta come and take care of dad or mom stuff thing I will point out is power of attorney is going to end death. So some people think that your child is going to be put in a position of distributing the money after your deceased and he could well be that you're going to name this same child is the executor in your will so, but they still don't get to make decisions about who gets what is the will the does that that you wrote.

So a lot of people do these things all at the same time but today were just talking about power of attorney as they begin when they began and they end at the end of your life. Now what they're there :-) the bank pointed that out to me very quickly really do that have to do that all the time because people come in their hand the power of attorney and that you know that's on file go look in the file were to do this. So-and-so just died in there like okay that's fine were to lock up the account now what I really want to do in the first part of the show and I've gone beyond the break. Talking about is convince you of the need to do this and then talk about a little bit about who you are in the name now I want to make one last point number to move on to the pitfalls I want to talk about what is called a springing power of attorney and I mentioned that I asked you before the show should you know what that is and you I thought might be the Tigger power of attorney, the wonderful thing to best fit their bouncy but anyway that wasn't it. I was, that's not it. With the gist of that is is that I'm not recommending a springing power of attorney. Jesus can add one more hassle, but I am recommending it for somebody.

This is ain't doing 65 years old. I'm not putting my son in a power position to go spend my money just not doing will then that person in the absence of doing a power of attorney. I might recommend a springing power of attorney and with that simply means springs into effect when I'm incapable of making financial decisions.

So it's very clearly in the thing it says the definition of when Robbie is not able to make decisions for himself than until that time this power of attorney has no effect but when that happens it has to be certified by one doctor to Drs. Harvey want to write it, then at that point the person you name has your power of attorney and it has affected so again don't recommend that you go do that all powers of attorney just sounds like because this can add some more hassle running down the doctor that sort of thing, but use it if if you're selling this to your parents and they're just not going to do it without something like that will then go and put it in there and then will at least have something in place to prevent the guardianship right okay so now you can shift to the pitfalls okay so now that I've convince you to do it and I'm still there. Do it. What are some things that could go wrong number one the power of attorney that you name could be deceased before you are and so that's why you need to over three of the two of them is usually enough because if the first one dies then you can go in and just add another one is if you're still got together. But if you don't then you just, you're left with the number two and the number two that's what you need to pay just as much attention to the number two is the number one because the person you picked so carefully could be deceased. That happened with my sister had healthcare power of attorney on my mom well she kinda needed it. She was in. About halfway through Alzheimer's about her for five years and my sister died and then you know I was named second so it was pretty easy as we went and redid everything will remove my mama. North Carolina and I was the number one on the financial power of attorney. But just know that is you need more than one person they need to be younger than you and you need to pay attention to the number two person that you put down because they may be the number one person when this thing is actually happening. I people could use a power of attorney for the first purposes, just you know immunity goes beyond your your son or daughter is is that they could be in a very unfortunate financial position or something and it could be there spouse that influences them to go pay themselves for something or despise there is the potential for fraud and it does go on and again that's why you need to pick your people carefully but that there isn't really a very good policing system on these things is existent in a drawer somewhere and most of the time. These are not registered with the court. There just they're just there so you need to hold tightly keep an eye on things and then keep an eye on your powers of attorney when it comes to healthcare. The reason you need a separate one is and is recommended you could try to write the healthcare powers into the same one, but is much cleaner just due to him once one handles financial matters somebody could sell your house mortgage your house borrow money check you into a senior living center could sell your car by a car pay her car insurance draw money out of your IRA to a minimum distribution immunity just gives them the full powers to conduct your business and that they are fiduciaries.

There they are responsible according to the law to act on your behalf, and their penalties if they didn't act on their behalf, but people still do, it is still ends up happening. The healthcare power of attorney is just so they can go negotiate with the doctors the hospital the healthcare settings. The home healthcare agency where the do surgery or not, will you do take Pacific drug or will you go see a different specialist I which ended up in my father's case again to be really helpful because it was quite clear to the family near the end of his life that you know we were done within an hour hospital program. It was, it was pertinent my mean it was hard and so we are able to because we had healthcare power of attorney say no income back in the hospital were working to finish things here.

We got hospice and whatever were so glad we did that because it would just meant more torture for an that's what the deal we do this all the time for people we do it all over the country. We have an attorney in our office in caring Durham and she will work with people over the phone so we have people all over the state or state is limited to North Carolina but we have another arrangement with a group of attorneys that can do this over the phone or a resume and they cover another 22 states and if you're not covered by those 22 states in North Carolina. I will find you an attorney and I've done that for funny people because it's in my book. I'll find you somebody that is meant to charge an arm and leg. You don't need Perry Mason defendant for the know for a power of attorney and knowing a simple will and most of these can get done for $1000.

Your last week and get all the documents even for a couple which should be a total of eight documents because we would throw in a redoing her and updating of your will and doing the HIPAA release which is it another document that you really want is you want the power to look at hip information can be released to you as the child or you want as if you're the person giving it that your your your power of attorney or your child can have that as well so this is just kind of like the clients that are coming in. We tend to make it routine and the reason I'm highlighting it today is a just went through a presentation when I was at the slot meeting of a lady attorney that went through this and she really made some points with Manis and John bring this up again. Get this done while your of sound mind and it'll just add some peace to write a minute.

It is based you because I know I mean that these decisions were made for my family right because at this point in time that there's a lot of stress I was there with my dad. I'm making these decisions whatever and to have the ability to do it without getting a bunch of attorneys and doing a bunch of crazy stuff about a bunch of drama when it's the least convenient minces no time to be adding drama when already your your your father, your mother sick or whatever the situation is the fastest really part of the reason it's nice to have the goat around this and if you have young adults that are still under your prevents you know they're not married yet, like my younger sons to. She recommended a number to get this done that I get a healthcare power of attorney into financial power of attorney where he's given that to my wife and me, so that if you were to get in an accident or need somebody to step in and take care of things for him. I don't have legal authorities and adult so I'm in a do that for him. I'm also do for my older son who's married Emma to just give them these four documents and on the pay the attorney to do it for them is just can be a gift, it doesn't sound like a real exciting gift to hear the holiday season him and give him some of things to help.

Now your power to the Harry Christmas. Well, I think the dog I'm able to influence about my kids actually see the gift that I bought life-insurance and LII. Give it to them, but you're right, you need to get of other things. As is and this is you get excited about it. 25 or 35 so again there is a video about this, and Hans YouTube channel which is Cardinal advisors and or you can go to Col. guide.com get hospice book the complete cargo guide to planning for living in retirement. That whole section on all these documents but it is absolutely wonderful and again he got a cargo guide.com and email Hans any questions you have or certainly want to contact them on the pharmacy here. It really is helpful with this stuff is unbelievable when you got it and place it it it does provide peace. Thank you so much for list and enjoy your Christmas season. Thank you. Finishing well is a general discussion and education of the issues facing retirees Cardinal guide.com Cardinal advisors upon trial CFP some insurance this show does not offer investment products or investment advice. We hope you enjoyed finishing well brought you by cargo guide.com visit Cardinal guide.com for free downloads of the show previous shows on topics such as Social Security, Medicare and IRAs long-term care life-insurance investments and taxes as well as constant best-selling book, the complete Cardinal guide to planning for and living in retirement and the workbook once again for dozens of free resources past shows get Hans book go to Cardinal guide.com if you have a question, comment, digestion for future shows. Click on the finishing well radio show on the website and send us a word. Once again that's Cardinal guide.com Cardinal guide.com this is the Truth Network