Finding out your Power of Attorney is useless

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Fremdon Ferndock
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Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

Has this happened to anyone?
You think you’ve done everything right: Your parents or other relatives have signed a durable power of attorney. Among other things, it allows you to handle their finances — taxes, bills, bank accounts, real estate sales — if they become incapacitated.

Everyone sleeps better. Months or years later, suddenly or gradually, the time comes when older family members can no longer manage transactions on their own.

You take the witnessed and notarized document to a financial institution — a big brokerage firm like Wells Fargo or Ameriprise, or a national or regional bank or credit union. And officials say no, they won’t honor your power of attorney.

They insist that the account owners sign the institution’s own power of attorney form — very unwelcome news, because by now the older account holders may not be competent to sign legal forms.
https://www.nytimes.com/2016/05/10/heal ... rless.html

I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs? Might have to move that Vanguard account after all to a more rational financial organization. Anybody know what Schwab and Fidelity are doing?
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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
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ResearchMed
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

Pennsylvania, where Vanguard is, passed a law several years ago, that ANY legal/valid PoA must be accepted.
Vanguard fought this, or perhaps the proper terminology is, simply ignored this, for quite some time.
I've heard they now accept outside PoAs, but we haven't experienced that.

We had good experience with Schwab. When we moved very elderly MIL closer to us, to go to Assisted Living, she had zero interest in leaving the facility unless it was an absolutely necessary medical situation.

Schwab took her (very old!) DPoA naming DH, had their legal dept look at it, thanked us, and noted that on her new account. Schwab never met her in person, and never spoke with her by phone. DH had no problem accessing online, or going personally to ask them to do something. (One example was when he found a few very old and tattered original stock certificates. We asked Schwab to take care of it for us, and a few weeks later, the shares all showed up in her account.)

Two very different customer service models...

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Fremdon Ferndock
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

bsteiner wrote: Wed Jun 15, 2022 4:03 pm Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
How exactly can you submit your POA to Vanguard and what evidence do they provide to indicate whether they've accepted it? I had a bad enough time dealing with them about beneficiary designations.
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Re: Finding out your Power of Attorney is useless

Post by Luckywon »

Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
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Re: Finding out your Power of Attorney is useless

Post by Lee_WSP »

Luckywon wrote: Wed Jun 15, 2022 4:28 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
Not with Wells Fargo. Just saying.

edit: They routinely ignore trustee succession if that was unclear.
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Re: Finding out your Power of Attorney is useless

Post by Lee_WSP »

Yes, it's a big problem with Wells Fargo and other national banks. Not as big of a problem with local banks. And not as big of a problem with the larger brokerages, but seems to be hit or miss with smaller brokerages.

If your state has passed the uniform power of attorney act, it is much easier. And if they haven't, well, the bank can roadblock you for a while.

Either way, the solution is a conservatorship or a CFPB complaint or a letter to their legal department (in reverse order of severity).
Last edited by Lee_WSP on Wed Jun 15, 2022 4:34 pm, edited 1 time in total.
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Re: Finding out your Power of Attorney is useless

Post by Luckywon »

Lee_WSP wrote: Wed Jun 15, 2022 4:31 pm
Luckywon wrote: Wed Jun 15, 2022 4:28 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
Not with Wells Fargo. Just saying.

edit: They routinely ignore trustee succession if that was unclear.
That's interesting. Have you had experience with Schwab? Etrade? Fidelity? I have trust accounts at each of those.
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Re: Finding out your Power of Attorney is useless

Post by Lee_WSP »

Luckywon wrote: Wed Jun 15, 2022 4:34 pm
Lee_WSP wrote: Wed Jun 15, 2022 4:31 pm
Luckywon wrote: Wed Jun 15, 2022 4:28 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
Not with Wells Fargo. Just saying.

edit: They routinely ignore trustee succession if that was unclear.
That's interesting. Have you had experience with Schwab? Etrade? Fidelity? I have trust accounts at each of those.
The large ones don't usually have issues once you present them with a new trust certificate. Sometimes they'll ask for more information, but usually not.
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Re: Finding out your Power of Attorney is useless

Post by TN_Boy »

Fremdon Ferndock wrote: Wed Jun 15, 2022 4:16 pm
bsteiner wrote: Wed Jun 15, 2022 4:03 pm Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
How exactly can you submit your POA to Vanguard and what evidence do they provide to indicate whether they've accepted it? I had a bad enough time dealing with them about beneficiary designations.
What I did was get Vanguard agent authorization on the relevant accounts. This was five or six years ago. At that point in time, the relative I was helping was competent to help me go through the steps. I also had durable POA, but yeah, that wasn't good enough for Vanguard.

I also had to get the "POA equivalent" from the relative's bank. I managed to get all this done before it became critical.

Yes, it is annoying. You do want them to be careful ... but some of the precautions seem arbitrary.
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Re: Finding out your Power of Attorney is useless

Post by Kagord »

The advice I have is to set up individual POAs at each financial institution and the "local predominant" titling company in town if there is one. Saves much hassle down the road.
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ResearchMed
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

Luckywon wrote: Wed Jun 15, 2022 4:34 pm
Lee_WSP wrote: Wed Jun 15, 2022 4:31 pm
Luckywon wrote: Wed Jun 15, 2022 4:28 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
Not with Wells Fargo. Just saying.

edit: They routinely ignore trustee succession if that was unclear.
That's interesting. Have you had experience with Schwab? Etrade? Fidelity? I have trust accounts at each of those.

See my comment about our (good!) experience with Schwab, posted a short time ago.

No complaints whatsoever. A very nice surprise during about 4-5 years.
Perhaps that was a function of our local branch? No idea about how widespread our experience would have been if we were at a different location.

At TIAA, with DH's 403b, we have had NO problems whatsoever.
Indeed, to remove money from his 403b a few months ago, we had the weird experience of my needing to "agree" to a form that I was already signing as the PoA. But they honored all of it.

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Re: Finding out your Power of Attorney is useless

Post by galawdawg »

Fremdon Ferndock wrote: Wed Jun 15, 2022 4:16 pm
bsteiner wrote: Wed Jun 15, 2022 4:03 pm Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
How exactly can you submit your POA to Vanguard and what evidence do they provide to indicate whether they've accepted it? I had a bad enough time dealing with them about beneficiary designations.
The best approach is to transfer your holdings in-kind to Schwab or Fidelity and end the frustration of dealing with Vanguard's obstructionist policies and practices as regards to valid POA documents.

If you still want to stay at Vanguard, I'd suggest trackable delivery (UPS, FedEx, or USPS Priority or certified mail) with the POA and an appropriate cover letter.
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Re: Finding out your Power of Attorney is useless

Post by Lee_WSP »

Another consideration is whether or not your designated agent has critical need of the account or not. If you believe they'll need access, making sure they can get it is something you should do today. If not, then if it's an acute incident, then it's not a big deal. If you're going to be in a assisted living for the rest of your life, it may not matter either as it'll be distributed as part of your estate eventually anyway and you may not need it as you'll be on government benefits. Or maybe you won't and you do need it to pay the facility.

Just something to think about.
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Re: Finding out your Power of Attorney is useless

Post by JoinToday »

The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.
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Re: Finding out your Power of Attorney is useless

Post by jebmke »

JoinToday wrote: Wed Jun 15, 2022 4:48 pm The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.
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Re: Finding out your Power of Attorney is useless

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JoinToday wrote: Wed Jun 15, 2022 4:48 pm The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.

A "Springing Power of Attorney" doesn't become effective until the person is no longer competent.

The problem with that type of PoA is that one would need to get physicians, at the least, to make the determination about that compentency or lack thereof.

A Durable POA has the advantage of being in effect once signed and also when the person is no longer competent.
A simple "POA" works "now", but then stops when the person becomes incompetent.

Make sure you both understand which type of POA you are planning to use.

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Re: Finding out your Power of Attorney is useless

Post by RetiredAL »

Lee_WSP wrote: Wed Jun 15, 2022 4:34 pm
Luckywon wrote: Wed Jun 15, 2022 4:34 pm
Lee_WSP wrote: Wed Jun 15, 2022 4:31 pm
Luckywon wrote: Wed Jun 15, 2022 4:28 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 3:59 pm I'm concerned about my Vanguard accounts, since their POA form only lets you name one person as POA. What if I become incapacitated and then something happens to my POA and there are no contingent POAs?
Titling an account to a RLT (assuming this is not a retirement account) is one way to address succession of powers with more flexibility.
Not with Wells Fargo. Just saying.

edit: They routinely ignore trustee succession if that was unclear.
That's interesting. Have you had experience with Schwab? Etrade? Fidelity? I have trust accounts at each of those.
The large ones don't usually have issues once you present them with a new trust certificate. Sometimes they'll ask for more information, but usually not.

My Dad made me his Trustee several years back. For Schwab, it was mail in their form and it happened within a week. Changing Wells Fargo Advisor account was not difficult in his Advisor's Office.

However, as a Wells Trade customer several years later, dealing with their central processing center relating to POA to his IRA's was a terrible PIA experience, that was ultimately solved by going to Schwab and have them transfer the accounts.

Of note, my Dad's lawyer lamented to us 2 years ago about his difficulty in dealing with bankers at WF, including WFB not accepting court orders without a fight.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

As far as I can determine, Vanguard's online "POA" form is really not a POA -- it is more properly called an "Agent Authorization" that gives account access rights to a named individual. Some problems with this I can see are:

- you cannot name contingent "agents" who can replace the primary agent if necessary. What if I'm incapacitated and my "agent" dies or is incapacitated?

- you cannot name multiple individuals who can act either independently or jointly

- the agent's authority is granted immediately, not contingently based on the owner's incapacity

Not a very suitable replacement for an actual POA.
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Re: Finding out your Power of Attorney is useless

Post by RetiredArtist »

Fremdon Ferndock wrote: Wed Jun 15, 2022 4:16 pm
bsteiner wrote: Wed Jun 15, 2022 4:03 pm Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
How exactly can you submit your POA to Vanguard and what evidence do they provide to indicate whether they've accepted it? I had a bad enough time dealing with them about beneficiary designations.
10 years ago, Vanguard would not accept a POA from our relative, requiring Agent Authorization forms instead. As I recall, they had to be notarized. Maybe this has changed. You could go to Vanguard's Message Center & upload your POA. But wait- you aren't yet authorized. Does your relative have online access? They could upload the form naming you as POA. If no online access, you or your relative will have to phone Vanguard.

Our POA's were rejected 90% of the time. Everyone wants you to fill out their form. Same for Medical POA's.
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Re: Finding out your Power of Attorney is useless

Post by galawdawg »

RetiredArtist wrote: Wed Jun 15, 2022 5:06 pmYou could go to Vanguard's Message Center & upload your POA. But wait- you aren't yet authorized. Does your relative have online access? They could upload the form naming you as POA.
The OP is the Vanguard account holder.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

ResearchMed wrote: Wed Jun 15, 2022 4:53 pm
JoinToday wrote: Wed Jun 15, 2022 4:48 pm The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.

A "Springing Power of Attorney" doesn't become effective until the person is no longer competent.

The problem with that type of PoA is that one would need to get physicians, at the least, to make the determination about that compentency or lack thereof.

A Durable POA has the advantage of being in effect once signed and also when the person is no longer competent.
A simple "POA" works "now", but then stops when the person becomes incompetent.

Make sure you both understand which type of POA you are planning to use.

RM
My attorney-drafted DPOA specifies that it is a "springing" DPOA; i.e., I must be evaluated and determined to be incapacitated by a physician before it is in effect. I understand that the "durability" designation means the POA survives after one has become incapacitated, but I guess it doesn't necessarily have to be effective before that point.
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Re: Finding out your Power of Attorney is useless

Post by Lee_WSP »

A durable one requires the agent to possess the document. I suppose they could have broken into your house and made a copy, but obviously you should not trust such a person in the first place.
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Re: Finding out your Power of Attorney is useless

Post by UpperNwGuy »

RetiredArtist wrote: Wed Jun 15, 2022 5:06 pm Our POA's were rejected 90% of the time. Everyone wants you to fill out their form. Same for Medical POA's.
Who is rejecting your medical POAs?
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Re: Finding out your Power of Attorney is useless

Post by DoubleComma »

We had Wells Fargo reject a POA because they had no proof the account owner was incapacitated. It was frustrating, but we ultimately got a physicians note along with a letter from our attorney, and they happily accepted the POA

It was a hassle, but I'm pleased that its a little difficult to get a hold of someone's accounts.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

DoubleComma wrote: Wed Jun 15, 2022 6:06 pm We had Wells Fargo reject a POA because they had no proof the account owner was incapacitated. It was frustrating, but we ultimately got a physicians note along with a letter from our attorney, and they happily accepted the POA

It was a hassle, but I'm pleased that its a little difficult to get a hold of someone's accounts.
I wonder about the "incapacitation" criterion. My mother drafted a DPOA years ago that didn't stipulate incapacitation. Through the years we've had to invoke her DPOA numerous times and it made things easier that we didn't have to support incapacitation each time. My attorney told me that a physician's letter would be necessary to do that, and I can imagine each organization wanting to verify that, and having the need to have a recent physician's evaluation which would have required multiple such evaluations.
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Re: Finding out your Power of Attorney is useless

Post by RetiredAL »

Fremdon Ferndock wrote: Wed Jun 15, 2022 6:17 pm
DoubleComma wrote: Wed Jun 15, 2022 6:06 pm We had Wells Fargo reject a POA because they had no proof the account owner was incapacitated. It was frustrating, but we ultimately got a physicians note along with a letter from our attorney, and they happily accepted the POA

It was a hassle, but I'm pleased that its a little difficult to get a hold of someone's accounts.
I wonder about the "incapacitation" criterion. My mother drafted a DPOA years ago that didn't stipulate incapacitation. Through the years we've had to invoke her DPOA numerous times and it made things easier that we didn't have to support incapacitation each time. My attorney told me that a physician's letter would be necessary to do that, and I can imagine each organization wanting to verify that, and having the need to have a recent physician's evaluation which would have required multiple such evaluations.
FF, you bring up a good point!

DW and I were always non-conditional POA's to each other, but initially our children would have required "incapacitation", potentially of both of us, to assume POA. So 2 years ago at the start of Covid, we made them full-time non-conditional POA's, never told them explicitly, but they know where our Estate Paperwork is and that they are named as our POA agents. My local son was made a registered 2nd agent to my Fidelity IRAs, where most of our money is. DW is not into finance at all, so if something happens to me he, has access to our $ via his logon.

Also line of procession could be an issue. My very elder Dad's paperwork had me as the Active POA and active Trustee, with my sister as alternate. She did not want the duties, so we had my Dad's paperwork changed to me, then each of my three adult children, then my DW, then my sister as last.
Last edited by RetiredAL on Wed Jun 15, 2022 6:51 pm, edited 1 time in total.
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Re: Finding out your Power of Attorney is useless

Post by bsteiner »

ResearchMed wrote: Wed Jun 15, 2022 4:53 pm
JoinToday wrote: Wed Jun 15, 2022 4:48 pm The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.
A "Springing Power of Attorney" doesn't become effective until the person is no longer competent.

The problem with that type of PoA is that one would need to get physicians, at the least, to make the determination about that compentency or lack thereof.

A Durable POA has the advantage of being in effect once signed and also when the person is no longer competent.
A simple "POA" works "now", but then stops when the person becomes incompetent.

Make sure you both understand which type of POA you are planning to use.
You can specify whatever condition you want for a springing power. You could say it becomes effective if two doctors, one male and one female, say you're incapacitated. (I've never done one that required more than one doctor.) Or you could say it becomes effective 10 years from the date you signed it. Or you could say it becomes effective when the Jets win the Super Bowl or when the Orioles win the World Series.

Florida no longer allows springing powers.

I've never seen one that wasn't durable.
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

bsteiner wrote: Wed Jun 15, 2022 6:47 pm
ResearchMed wrote: Wed Jun 15, 2022 4:53 pm
JoinToday wrote: Wed Jun 15, 2022 4:48 pm The problem I have with VG is I can't fill out the forms now and then have them become effective in 5, or 10, or 15 years. Wife and I are in our 60's, good health, and mentally capable (well, at least my wife has all her faculties; she questions my ability :wink: ). I would like to have everything set up if needed for the future, but don't want to give immediate access or visibility of our assets to a child (age 30) who would be managing our affairs. We haven't had the conversation about our assets & investments yet with child.
A "Springing Power of Attorney" doesn't become effective until the person is no longer competent.

The problem with that type of PoA is that one would need to get physicians, at the least, to make the determination about that compentency or lack thereof.

A Durable POA has the advantage of being in effect once signed and also when the person is no longer competent.
A simple "POA" works "now", but then stops when the person becomes incompetent.

Make sure you both understand which type of POA you are planning to use.
You can specify whatever condition you want for a springing power. You could say it becomes effective if two doctors, one male and one female, say you're incapacitated. (I've never done one that required more than one doctor.) Or you could say it becomes effective 10 years from the date you signed it. Or you could say it becomes effective when the Jets win the Super Bowl or when the Orioles win the World Series.

Florida no longer allows springing powers.

I've never seen one that wasn't durable.
Thanks for that clarification. I hadn't realized that "springing" could be triggered by other conditions.
So that makes more sense. (If it could *only* be triggered by incapacitation, then that makes less sense).

So in Florida, one cannot have a POA that only becomes effective when the person is no longer competent? Is this common in other states?
I've heard many discussions (which aren't necessarily consistent with "what's available, obviously) where people do not want someone operating as their POA *until* they can't do it themselves. JoinToday's comment seems to be a situation like that.
That could be due to privacy concerns ("I don't want them to know these details unless it's *really* necessary" or such), or perhaps just not wanting to relinquish any control until *really* necessary, or perhaps so there aren't inconsistencies in actions by more than one person who is authorized to "do things" (the person not yet incapacitated and the agent).

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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

bsteiner wrote: Wed Jun 15, 2022 4:03 pm Give them a copy of the power of attorney now. That way, you'll know whether they'll accept it. Brokerage firms and title companies seem to be pretty good. Banks vary.

As states enact legislation providing for the recovery of legal fees from financial institutions that unreasonably refuse to accept powers of attorney, this will happen less often. New York and Florida have such statutes.
Thanks Bruce. I absolutely agree. Our Fidelity rep archived our POA and confirmed with their legal staff that it would be 100% honored. Vanguard? Well, we've heard several reports.....
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

Fremdon Ferndock wrote: Wed Jun 15, 2022 4:16 pm How exactly can you submit your POA to Vanguard and what evidence do they provide to indicate whether they've accepted it? I had a bad enough time dealing with them about beneficiary designations.
Many have. Maybe time to consider a different brokerage house.
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Re: Finding out your Power of Attorney is useless

Post by FreddieFIRE »

Kagord wrote: Wed Jun 15, 2022 4:39 pm The advice I have is to set up individual POAs at each financial institution and the "local predominant" titling company in town if there is one. Saves much hassle down the road.
Doesn't that immediately provide POA powers to the nominated individual? Some would prefer to not have their POA "own" their assets until required.
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Re: Finding out your Power of Attorney is useless

Post by HomeStretch »

Even once you get the durable POA (either attorney drafted or the financial institution’s POA or agent authorization form) recognized by the financial institution, you may run into issues later that are hard to find a solution for.

Spouse and I recently ran into 3 separate issues with existing POAs we have been utilizing for our incapacitated parents (explained, below). I am trying to figure out how to avoid such issues in the future with our DPOAs. As we are not in a community property state we can’t have a joint RLT so it makes it difficult to use the RLT approach for all our joint accounts/assets.

Issue 1 - spouse has/had DPOAs on file with Fidelity for parents’ joint Taxable account and handled their financial affairs for several years. Spouse’s father recently passed in a non-community property state. Fidelity required spouse’s mother (who has dementia) to open up a new account to transfer the holdings from the joint account to an individual account in order to remove deceased father from the account registration and to do the step-up of the account holdings. Fidelity required new POA/agent authorization documents for the new account. Luckily mother was able to sign the paperwork in their office but if this had happened 3 months later, she would have been too far incapacitated to complete the documentation (sudden worsening of dementia from mild to severe).

Issue 2 - I manage my parents’ financial affairs (one is severely cognitively impaired) at Vanguard with Full Agent authorization (FAA) as Vanguard refused to accept their attorney-drafted POAs even though their state legally requires Vanguard to do so. I recently set up two new accounts for my mom online. Luckily the FAA is their old version so it carried over to the new accounts but it took a couple hours of phone time to get a rep who understood this was allowed and to get the FAA applied to the new accounts. Per the rep, Vanguard’s current FAA form does not allow the existing FAA to apply to new accounts. How could an incapacitated account holder like my father execute a new FAA and get it notarized.

Issue 3 - I need to set up new individual checking accounts for my parents in connection with my Dad beginning to receive Medicaid LTC benefits. I am a co-account holder on their existing joint Bank of America accounts (BoA refused years ago to accept their attorney-drafted POA so my parents set me up as a co-account holder for convenience). BoA will not remove one parent from the existing account nor will they allow me as POA to set up individual accounts on their behalf. There is no way I can take my incapacitated dad from a skilled nursing facility and my mobility-impaired mom on chemo into a not-so-local BoA branch (their town branch closed recently) to get new accounts set up. I read on a forum thread that a POA can set up accounts at Schwab without the account holder being present. Not sure if there are any other banks or brokerages that allow this.

A lot of detail but I think it’s hard to understand how an established POA/FAA can fail just when it’s needed most (i.e., incapacitation) without the details.
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Re: Finding out your Power of Attorney is useless

Post by mary1492 »

HomeStretch wrote: Wed Jun 15, 2022 7:47 pm BoA will not remove one parent from the existing account nor will they allow me as POA to set up individual accounts on their behalf.
Can you not create new individual accounts for them online? You just need their personal info and be able to answer the identity verification questions the online app will ask. I create new checking and saving accounts for my spouse and child all the time (signing up for bonuses) at various banks through their online app. Out of the 20+ times I've done it, maybe once or twice it's been rejected for some silly reason.
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Re: Finding out your Power of Attorney is useless

Post by HomeStretch »

mary1492 wrote: Wed Jun 15, 2022 7:57 pm
HomeStretch wrote: Wed Jun 15, 2022 7:47 pm BoA will not remove one parent from the existing account nor will they allow me as POA to set up individual accounts on their behalf.
Can you not create new individual accounts for them online? You just need their personal info and be able to answer the identity verification questions the online app will ask. I create new checking and saving accounts for my spouse and child all the time (signing up for bonuses) at various banks through their online app. Out of the 20+ times I've done it, maybe once or twice it's been rejected for some silly reason.
I was trying to open new joint accounts (I will be an account holder for convenience) in accordance with the bank’s term and conditions but opening new accounts online at a non-BofA bank on their behalf may be where I end up. Unfortunately BoA is not an option as they require a manual signature card to be returned even for checking accounts opened online.

Thanks for reminding me of this option!
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

I spoke with my attorney about my DPOA today. My DPOA contains a clause that grants permission to my POA to conduct online transactions. My attorney's position is that the purpose of the POA is to grant full authority to the POA to conduct any and all financial transactions as my surrogate and that clause specifically includes the right to conduct online transactions, just as I would. The DPOA authorizes that as a legal activity, as far as my POA is concerned.

Now, it could be the case that one of my financial institutions, if they learned that online transactions were being conducted by someone other than myself, could lock my online accounts for "security" purposes. To allow for that possibility, also filing the institution's Agent Authorization form might be a reasonable backup plan so that my POA could still access my accounts offline at least.
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Re: Finding out your Power of Attorney is useless

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Fremdon Ferndock wrote: Wed Jun 15, 2022 8:26 pm I spoke with my attorney about my DPOA today. My DPOA contains a clause that grants permission to my POA to conduct online transactions. My attorney's position is that the purpose of the POA is to grant full authority to the POA to conduct any and all financial transactions as my surrogate and that clause specifically includes the right to conduct online transactions, just as I would. The DPOA authorizes that as a legal activity, as far as my POA is concerned.

Now, it could be the case that one of my financial institutions, if they learned that online transactions were being conducted by someone other than myself, could lock my online accounts for "security" purposes. To allow for that possibility, also filing the institution's Agent Authorization form might be a reasonable backup plan so that my POA could still access my accounts offline at least.
You would be wise to be proactive. In our family's experience with 2 DPOA situations, none of the financial institutions accepted a POA document and all required their own forms.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

mkc wrote: Wed Jun 15, 2022 8:49 pm
Fremdon Ferndock wrote: Wed Jun 15, 2022 8:26 pm I spoke with my attorney about my DPOA today. My DPOA contains a clause that grants permission to my POA to conduct online transactions. My attorney's position is that the purpose of the POA is to grant full authority to the POA to conduct any and all financial transactions as my surrogate and that clause specifically includes the right to conduct online transactions, just as I would. The DPOA authorizes that as a legal activity, as far as my POA is concerned.

Now, it could be the case that one of my financial institutions, if they learned that online transactions were being conducted by someone other than myself, could lock my online accounts for "security" purposes. To allow for that possibility, also filing the institution's Agent Authorization form might be a reasonable backup plan so that my POA could still access my accounts offline at least.
You would be wise to be proactive. In our family's experience with 2 DPOA situations, none of the financial institutions accepted a POA document and all required their own forms.
Thanks for the advice. Before this thread I didn't even know this was a thing. Having my POA find out after I'm incapacitated would be an unfortunate way to learn about it for the first time. Bogleheads to the rescue, once again.
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Re: Finding out your Power of Attorney is useless

Post by mary1492 »

About a year and a half ago, we had a "near miss" with mom. At the time, she realized that she was not in a good mental state and added me and sis as joint owners on her Wells Fargo accounts. Up until then, mom was very good, adding me and sis as co-owners of her condo via life estate, having DPOA, listed as POA on her Fidelity accounts, and so on.

Early this year, things turned worse for mom, and knock on wood I have had no issues with most everything. Any time I've needed to do anything for mom where she'd generally need to do it, I just hand over a copy of the DPOA or email it and I've been given carte blanche. The one place which did surprise me was Carvana and attempting to sell her car. We moved mom from FL to NJ when her situation turned worse early this year and I've made a couple trips to FL since to settle her affairs there. I originally planned to sell her car there quickly through Carvana, but they said they could not accept POA and she needed to be present when handing over the car. So I recently drove it from FL to NJ and Carvana says they can accept it as long as mom's present when they take it, even with the FL plates and title.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

Is the consensus here that Fidelity and Schwab have been OK accepting attorney-drafted DPOAs? Has anyone experienced any difficulties with either of them in this regard? I'd be willing to move my accounts to either one from Vanguard if I were sure I my DPOA would be acceptable there.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

I just spoke with a Vanguard customer service rep and asked where I need to submit my attorney-prepared DPOA for review and approval. After he dutifully checked with someone, he told me that Vanguard does not accept externally-prepared POAs and that I would have to complete Vanguard's internal POA, which as we know is actually an Agent Authorization and not a complete POA. So I guess the leopard has not changed his spots. If you want to have your attorney-prepared DPOA honored, please go elsewhere. Well, I think I just might do that.
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Re: Finding out your Power of Attorney is useless

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Fremdon Ferndock wrote: Thu Jun 16, 2022 8:29 am I just spoke with a Vanguard customer service rep and asked where I need to submit my attorney-prepared DPOA for review and approval. After he dutifully checked with someone, he told me that Vanguard does not accept externally-prepared POAs and that I would have to complete Vanguard's internal POA, which as we know is actually an Agent Authorization and not a complete POA. So I guess the leopard has not changed his spots. If you want to have your attorney-prepared DPOA honored, please go elsewhere. Well, I think I just might do that.
Did you mention that Pennsylvania law that *requires* them to accept an external POA form?

I still can't figure out if they are instructed to "play stupid" or if some/many of them are really ignorant of that law.

RM
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Re: Finding out your Power of Attorney is useless

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ResearchMed wrote: Thu Jun 16, 2022 8:44 am
Fremdon Ferndock wrote: Thu Jun 16, 2022 8:29 am I just spoke with a Vanguard customer service rep and asked where I need to submit my attorney-prepared DPOA for review and approval. After he dutifully checked with someone, he told me that Vanguard does not accept externally-prepared POAs and that I would have to complete Vanguard's internal POA, which as we know is actually an Agent Authorization and not a complete POA. So I guess the leopard has not changed his spots. If you want to have your attorney-prepared DPOA honored, please go elsewhere. Well, I think I just might do that.
Did you mention that Pennsylvania law that *requires* them to accept an external POA form?

I still can't figure out if they are instructed to "play stupid" or if some/many of them are really ignorant of that law.

RM
Vanguard doesn't care. This issue has been brought to the attention of their executive offices before and they have not altered their position or policies on POA acceptance. It will likely take litigation to force compliance with PA law.

The best thing OP can do is transfer their holdings "in-kind" to another brokerage where they can invest in most, if not all, of the same low-cost index funds but receive outstanding 24/7 customer service and many other benefits. Some, including Schwab where I landed after nearly thirty years as a Vanguard customer, will even pay the OP a handsome bonus just for doing that.
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Re: Finding out your Power of Attorney is useless

Post by Fpdesignco »

Fremdon Ferndock wrote: Wed Jun 15, 2022 6:17 pm
DoubleComma wrote: Wed Jun 15, 2022 6:06 pm We had Wells Fargo reject a POA because they had no proof the account owner was incapacitated. It was frustrating, but we ultimately got a physicians note along with a letter from our attorney, and they happily accepted the POA

It was a hassle, but I'm pleased that its a little difficult to get a hold of someone's accounts.
I wonder about the "incapacitation" criterion. My mother drafted a DPOA years ago that didn't stipulate incapacitation. Through the years we've had to invoke her DPOA numerous times and it made things easier that we didn't have to support incapacitation each time. My attorney told me that a physician's letter would be necessary to do that, and I can imagine each organization wanting to verify that, and having the need to have a recent physician's evaluation which would have required multiple such evaluations.
If it’s not explicitly defined in the document, it will fall to your state laws. My home state of Missouri has very specific rules around how you are judged to be incapacitated.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

ResearchMed wrote: Thu Jun 16, 2022 8:44 am
Fremdon Ferndock wrote: Thu Jun 16, 2022 8:29 am I just spoke with a Vanguard customer service rep and asked where I need to submit my attorney-prepared DPOA for review and approval. After he dutifully checked with someone, he told me that Vanguard does not accept externally-prepared POAs and that I would have to complete Vanguard's internal POA, which as we know is actually an Agent Authorization and not a complete POA. So I guess the leopard has not changed his spots. If you want to have your attorney-prepared DPOA honored, please go elsewhere. Well, I think I just might do that.
Did you mention that Pennsylvania law that *requires* them to accept an external POA form?

I still can't figure out if they are instructed to "play stupid" or if some/many of them are really ignorant of that law.

RM
At the low level of customer service I was at, there didn't seem to be much point. I would have had to try to kick it higher up the food chain and even then the thought of a contentious exchange didn't appeal to me. If there's not going to be a cooperative attitude, how can I trust them to actually honor the POA when it comes time for my agent to exercise it? Not my cuppa.
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

I'm on chat with Schwab and this is what they're telling me. I'm trying to find out more:
Good question and with a new account at Schwab, we would need to have our Schwab POA form on file, along with your attorney prepared POA (for example, some clients have a Durable Power of Attorney request which they submit along with a Schwab POA form)
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Re: Finding out your Power of Attorney is useless

Post by galawdawg »

Fremdon Ferndock wrote: Thu Jun 16, 2022 10:47 am I'm on chat with Schwab and this is what they're telling me. I'm trying to find out more:
Good question and with a new account at Schwab, we would need to have our Schwab POA form on file, along with your attorney prepared POA (for example, some clients have a Durable Power of Attorney request which they submit along with a Schwab POA form)
They may be talking about this form: https://www.schwab.com/resource/attorne ... ey-in-fact. That provides Schwab the information on your agent.

This information is in the FAQ portion of my Schwab information thread: viewtopic.php?t=355173
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Re: Finding out your Power of Attorney is useless

Post by Fremdon Ferndock »

Here's the link to Schwab's POA form. Like everyone else's it only allows you to name a single POA without the provisions included in an attorney-prepared POA. I was told I can submit my attorney-prepared POA along with the Schwab POA but it wasn't explained how and under what circumstances the attorney POA would be honored.

https://www.schwab.com/public/file/P-22 ... eyForm.pdf
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Re: Finding out your Power of Attorney is useless

Post by ResearchMed »

Fremdon Ferndock wrote: Thu Jun 16, 2022 10:47 am I'm on chat with Schwab and this is what they're telling me. I'm trying to find out more:
Good question and with a new account at Schwab, we would need to have our Schwab POA form on file, along with your attorney prepared POA (for example, some clients have a Durable Power of Attorney request which they submit along with a Schwab POA form)
Is Schwab's POA not Durable?

What if the terms of the attorney-prepared DPOA differ in some material way from Schwab's form?
And if Schwab's form would override one's own DPOA, why bother to include it if Schwab's is required?

Note that about 5 years ago, we had Schwab open trust accounts for very elderly MIL, and DH used her existing DPOA (executed quite some time ago, in a different state). She had no interest (and would have refused) in showing up at Schwab and she wanted DH to do ALL of her finances once we moved her near us. Schwab never saw her or spoke to her.
They sent her DPOA (and perhaps her trust documents... I don't remember) to some sort of "legal", but I have no idea if that was national or local, etc.
Word came back that all was well and that was it. We very occasionally brought some paperwork over for her, but other than that, anything was done online (such as tax forms).
This was a small-ish account, so it wasn't like they wanted to please some high roller. (And most of our money is still captive in a 403b, so we also didn't have Big Money with Schwab. No reason to go out of the way to make us happy, either.)

Everything has been SO EASY at Schwab, including their excellent 24/7 phone or chat support.

RM
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Re: Finding out your Power of Attorney is useless

Post by galawdawg »

Fremdon Ferndock wrote: Thu Jun 16, 2022 10:59 am Here's the link to Schwab's POA form. Like everyone else's it only allows you to name a single POA without the provisions included in an attorney-prepared POA. I was told I can submit my attorney-prepared POA along with the Schwab POA but it wasn't explained how and under what circumstances the attorney POA would be honored.

https://www.schwab.com/public/file/P-22 ... eyForm.pdf
May I recommend (as I suggest in my Schwab information thread) that you reach out to a well-qualified Schwab financial consultant in the office nearest you? You can call or email. That consultant can also help you with transfer bonuses, fee waivers for purchases of Vanguard mutual funds and other questions you might have.

The linked form I provided above is required by Schwab to accompany an attorney-prepared POA, which they will accept. The agent is the only person who needs to complete the linked form so that Schwab is able to comply with regulatory requirements. If you have a contingent agent, the second agent would also need to prepare, sign and submit the linked form, but should only do so once the primary agent is unwilling or unable to serve if that triggers the second agent's authority.

If you aren't certain how to best identify an experienced Schwab financial consultant near you, the FAQ in my Schwab thread should help with that. If not, just let us know and we'll be happy to help...
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