• 👉 Work With Me
• Fidelity 2025 Family and Finance Study
• Power of Attorney 101 – American Bar Association (ABA)
• Guide for Agents Acting Under Durable Financial Powers of Attorney
• Durable Power of Attorney: What It Is and How It Works
• Power of Attorney Laws: 50‑State Survey
• Fraud Episodes:
  • The 6-Digit Code That Can Drain Your Retirement Account (And How to Stop It)
  • 8 Red Flags You’re About to Get Scammed
  • How to Protect Yourself From Financial Scams

Helping an aging parent with their money is a job almost nobody prepares for. 

And, unfortunately, love and trust don’t give you legal authority. 

You can be the most trusted person in your parents life — the one they’d want handling things if something went wrong — and their bank may still refuse to speak with you.

You may not be able to pay the mortgage, question a suspicious transaction, or access the money needed for their care.

That’s where a durable power of attorney for finances comes in. This legal document gives someone your parent chooses the authority to step in and help manage their financial life.

And on the surface it seems simple: your parent signs the document, and you’re authorized to help. 

But having the document is only the beginning. How it’s written and how you handle the responsibility can make all the difference.

So, in today’s episode, I’m going to explain how a durable power of attorney for finances actually works, the fine-print provision every family should double-check, five practical steps for serving in the role responsibly, and how to avoid common mistakes that can make an already difficult situation even harder.

Now, this is an important topic, and I don’t want you to feel like you need to take perfect notes or remember every detail I’m covering. So to make things easier — and help you and your family take action — I put together three actionable resources to go along with today’s episode: a one-page summary of the key takeaways discussed, a detailed estate-planning review checklist, and a simple guide to the documents, roles, and strategies that commonly make up a well-rounded estate plan.

If you’re already a Stay Wealthy newsletter reader, you don’t need to do anything — all three will be in today’s email, ready for you to download. 

If you’re not a newsletter reader, you can grab the resources by going to youstaywealthy.com/email. That’s youstaywealthy.com/email.

Along with practical checklists and guides like these, you’ll also receive a new retirement-focused article that I personally write and send every single Thursday, plus a handful of links to the best articles I’ve read in the past week.  

So if you find this podcast helpful, I’m confident you’ll enjoy the weekly email as well.

Welcome to another episode of the Stay Wealthy Retirement Show. I’m your host, Taylor Schulte, and every week I cover the most important financial topics to help you stay wealthy in retirement. Ok, onto today’s episode.

5 Steps to Protect Your Aging Parents’ Money (Before It’s Too Late)

What a Durable Power of Attorney Actually Does

In this episode, going to be describing common structures and issues in the United States, but it’s important to know that the exact rules and language depend on your state’s law and the attorney drafting your documents. So, as always, please treat this episode as education, not legal advice.

I also want to acknowledge that you may be listening to this from different sides of the table. Maybe your parents are still young and healthy, and this is a planning task you know they still need to tackle. Maybe they’re a little older – in their 80s or 90s – and you’re beginning to notice that certain things are slipping and wondering how to navigate this stage. Or maybe you’re thinking about your own children and what you would want to put in place for them someday. No matter where you are in that process, everything we’ll cover today can help you prepare for the conversations and responsibilities ahead.

So, with that in mind, let’s start with what a durable power of attorney actually is.

A durable power of attorney for finances—or DPOA—is a legal document that gives someone you trust permission to manage financial matters on your behalf. The person granting that authority is called the principal, and the person chosen to help is called the agent—or, in legal terms, the attorney-in-fact.

Put simply, this document allows someone to step into a person’s financial life and handle many of the things they would normally manage themselves. Pay the bills. Transfer money between accounts. File the tax return. Talk to the insurance company. Handle the things that don’t stop just because someone’s health did.

Now, this isn’t the only kind of power of attorney out there, and the differences matter. 

A limited power of attorney, as the name suggests, grants authority for a narrow purpose or a specific period of time. For example, you might authorize someone you trust to sign the closing documents for a property sale while you’re out of the country.

A general power of attorney is much broader. It gives the agent authority to handle a wide range of financial and legal matters rather than limiting them to one specific task.

But here’s the critical distinction: unless a power of attorney is specifically made durable, it generally stops working when the person who signed it becomes incapacitated—which is often the exact moment an aging parent needs help the most.

For example, imagine your father has a stroke and is lying in a hospital bed, unable to communicate. If he named you as his agent under a regular—or “non-durable”—power of attorney, you would likely be out of luck. That’s because your authority typically ends the moment he becomes incapacitated. However, if he had named you under a durable power of attorney instead, you would be able to legally step in and help with his financial affairs in this situation.

That word “durable” is doing all the work — it means the document survives incapacity. So, when we’re talking about powers of attorney for aging parents, durability is usually one of the most important features to include.

While many states and nonprofits offer free statutory forms and templates, I would encourage you and your loved ones to have an estate planning attorney prepare this document as part of a complete estate plan—alongside a will or trust, a healthcare power of attorney, and advance healthcare directives.

An attorney can help you understand exactly which powers you’re granting and also help you customize the document to fit your family’s situation. And as I’ll share later in the episode, the powers you leave out can create just as many problems as the powers you include.

The Fine Print That Matters Most

But what your chosen agent is allowed to do is only half of the decision. The other half — and it’s right there in the fine print — is when their authority begins.

In short, some durable powers of attorney take effect the moment they’re signed. Others only “spring” into effect after certain conditions are met—usually when the person is formally determined to be incapacitated. Depending on state law and how the document is written, that may require certification from one or more physicians.

These are commonly referred to as “springing” durable powers of attorney, and it’s easy to understand the appeal. A springing durable power of attorney allows you — or, for the sake of today’s conversation, your aging parents — to maintain control of their financial life while they’re healthy, and nothing allows someone else to step in and help until something is clearly wrong. On paper, that certainly feels safer, but in practice, springing documents can create two very real problems.

The first is that getting physicians to declare someone incapacitated is much harder than it sounds.

For example, let’s say you have an aging father who has started experiencing memory problems. On some days, it seems like everything is normal and he’s perfectly capable. But on other days, he forgets to pay bills, makes questionable financial decisions, or maybe even sends money to scammers. This is one of the challenges of cognitive decline: it’s not always obvious or consistent.

And while you might recognize that help is needed because you spend a lot of time with him, the springing document can’t be used until its legal requirements have been satisfied. So, you start the process, and you arrange an evaluation — only for your father to be having one of his good days. He’s charming. He knows the date, who the president is, and where he banks. As a result, the physician — quite reasonably — doesn’t feel comfortable declaring him unable to manage his affairs. Meanwhile, the missed bills and questionable decisions continue.

And to be fair to the physician, that hesitation is understandable. Declaring someone incapable of managing their own affairs is a serious decision, and in the gray area of early cognitive decline, an honest doctor may not be able to make that determination with confidence. So the problem isn’t necessarily the physician — it’s often that the document puts them in the position of gatekeeper, and as we can all imagine, that’s a tough position to be in.

The second problem is what that process does to a family. A springing clause in a durable power of attorney adds evaluations, waiting, and paperwork right in the middle of what is already one of the hardest seasons of their lives. So, instead of spending that energy helping your parent, you spend it trying to get permission to help.

Now contrast that with a durable power of attorney that’s effective immediately. If your father names you as his agent, you can submit the signed and executed documents to his financial institutions and ask to be formally recognized as his agent. Once their review process is complete — which may take 2-3 weeks — you can begin helping without waiting for a medical determination.

But an immediately effective document comes with its own trade-off.

Contrary to what many think, a durable power of attorney that is effective immediately, does not mean your father gives up control of his finances. He can continue managing his accounts and making his own decisions. However, in this scenario, you would technically have the legal authority to act on his behalf — even before he needs your help — and understandably, that could make him feel uneasy. That’s why an immediately effective document requires a high level of trust and careful selection of the agent. 

There may also be other ways to make the arrangement feel more comfortable. Depending on the family’s circumstances and state law, an attorney may be able to limit certain powers, require regular accountings, name a third party to provide oversight, or add other safeguards designed to reduce the risk of misuse.

So the choice isn’t as simple as saying one version is always better. A springing document may protect against an agent acting too soon, but it can make it harder to step in when help is needed. An immediately effective document avoids that delay, but it gives the agent meaningful authority from the start. If your parents trust someone enough to grant that authority, there can be value in having help available while they can still provide guidance and look over the agent’s shoulder. If they aren’t comfortable doing that, they may need different safeguards, a different agent, or perhaps a springing document.

Every family is different, and an estate-planning attorney can explain the trade-offs and help determine which structure makes the most sense. The important thing is to know which version your parents have — and, while you’re at it, which version you have. If nobody remembers, pull out the document and read the fine print, or ask the attorney who drafted it.

What Happens If This Document Never Gets Signed

Now, before we get into best practices for stepping in as an agent and how to avoid common mistakes, it’s worth understanding what happens to families who never put this document in place — because the alternative is far more difficult. And unfortunately, many families appear to be heading in that direction.

In fact, Fidelity’s 2025 Family and Finance Study found that only 41 percent of parents anticipate their children will have financial power of attorney. One common reason for this is that spouses will often name each other and fail to designate a backup. 

That missing backup becomes a serious problem if your parents decline to the point where they no longer have the legal capacity to sign a new document. At that point, gaining authority to act on their behalf usually means going through the courts — a process known as guardianship, or in some states, conservatorship. 

Here’s how it typically unfolds. You file a petition with the court and likely hire an attorney, which can cost several thousand dollars or more. One or more physicians then evaluate your parent and submit their findings. And finally, a judge decides whether your parent can still manage their finances or healthcare — and if not, who should have that authority and how broad it should be. 

The process can take a few months at minimum, and even then, the guardian typically has to file an annual accounting with the court and may need approval for major decisions. 

So, to summarize: a power of attorney is private; guardianship is public record. A power of attorney takes an appointment; guardianship can take months in court. A power of attorney is flexible and costs a fraction as much; guardianship comes with ongoing oversight for as long as it lasts. 

You might ultimately end up in the same place, but the experience can be very different. And the only thing that determines which path your family takes is whether the document was signed while it still could be.

What the Document Should Let You Do

Ok — so let’s say your family takes the better path, and the document gets signed in time. The next question is what’s actually written inside it. Because what you can and can’t do as an agent depends entirely on what the document says.

A well-drafted durable power of attorney might allow you to open and close accounts. Deposit and withdraw money. Pay bills and file tax returns. Buy and sell investments. Apply for government benefits. Handle digital assets. Make gifts. Or even change beneficiaries — with guardrails that I’ll come back to momentarily.

And here’s something important to take note of: the more powers the document names clearly and explicitly, the smoother your experience will be. That’s because financial institutions tend to be conservative about these documents, so if a specific power isn’t clearly spelled out, many will reject the document entirely or put restrictions on the account. Vague language that seems fine in the attorney’s office can become a roadblock at the bank, so when the document is being drafted — or updated — be sure to review it through the lens of “will the institutions holding their money accept this piece of paper?”

And this leads us to the practical side of the job. If you’ve been named as an agent — or expect to be — I want to share five steps I would encourage you to take. Five steps you can take to prepare for managing your aging parents’ finances, no matter how large or modest their savings may be.

Step One: Submit the Document Before You Need It

The first step is simple but almost universally skipped: if your parents opted for an immediately effective durable power of attorney, consider working with them to submit it to their financial institutions now, before anything is wrong.

As previously noted, when you submit one of these documents to a bank or brokerage firm, it doesn’t get approved at the branch that afternoon. It typically goes to a legal review department, and that review can take weeks.

Naturally, that would be frustrating if you’re trying to get access during an emergency. But to be fair to the banks, they’re trying to protect the account holder from unauthorized access — and if it were your account, you’d want them to be careful too.

The time to find out a document will be rejected is when nothing is wrong. So, if your parents bank at two places and invest at a third, submit the document to all three and confirm it’s accepted. If an institution pushes back — maybe the document is old, or missing language they require — you can fix that now, while your parent can still legally sign an updated version.

Step Two: Map Their Financial Life

And once the paperwork is in place, the next step is a conversation — because it’s nearly impossible to manage someone’s financial life if you don’t know anything about it.

But before you ask a single question about their accounts, I want to share a piece of advice that stuck with me from a recent New York Times article on this exact topic. According to the experts interviewed, the most common mistake adult children make isn’t a paperwork mistake — it’s treating their parents’ situation as a problem to solve. Showing up with a plan. Telling mom and dad what they need instead of asking what they want. As one expert put it in that piece, “Lead with love, not logistics.” Start by asking your parents what they want and how you can support them. The spreadsheets can wait a week.

This approach also helps to think of your involvement as more of a ladder instead of a switch. So consider starting with small, helpful things tp build trust and make your involvement feel normal. For example, the next time a big data breach is in the news, maybe you offer to help set up a credit freeze. From there, you might check in occasionally while they run things themselves. Later, you work through the finances together. And when managing it all becomes frustrating for them, you offer to take it over while keeping them in the loop — something like, “let me handle this and report back to you.” That framing is important, because it takes the work off their plate without taking away their control.

And once the conversation is open, you might consider asking questions like: Where are the bank accounts, and where are the investment accounts? What income shows up every month, and where does it land? Which bills are on autopay, and which still arrive on paper? What property do they own, and what does each property require? Who insures the cars, the house, their health, their long-term care — and how do those premiums get paid?

What you’re building is a snapshot of how their money works on an ordinary day: what comes in, what goes out, and how the bills get handled.

Too many people step into this role with no picture on the box. One honest conversation, written down, changes the entire experience.

Step Three: Triage the Bills

The third step is understanding that not all bills are created equal, and then building your priority list before you’re in charge of paying them.

For example, if the cable bill goes unpaid for a month, nothing meaningful happens. You make a phone call and it’s fixed. Other bills are a different story. Unpaid property taxes can carry severe, compounding consequences — and left long enough, they can put the home itself at risk. 

A lapsed health insurance or long-term care premium can mean losing coverage at exactly the moment it’s needed most, sometimes with no way to get it back.

So as you map out the financial picture in step two, mark the handful of bills where a miss is genuinely costly: property taxes, health insurance, long-term care insurance, homeowners insurance. Know when they’re due and how they’re paid. Everything else can likely be figured out as you go. 

Step Four: Document Everything

Step number four is protecting yourself — and your parent — with a paper trail.

More specifically, as you start paying bills and managing money, be sure to save the receipts. You can archive physical copies or use a digital file storage service like iCloud, Dropbox, or Google Drive. 

I’m suggesting this somewhat annoying task because someday, someone may ask questions. Maybe a sibling wonders how mom’s money was spent. Or a named beneficiary questions a reimbursement you made to yourself for expenses you covered. In those moments, a folder of dated receipts can mean everything.

And while you’re at it, consider keeping a simple medical journal for them as well. Track current medications, major appointments, treatment changes, and how your parent responds over time. 

You may also want to attend important doctor’s appointments with them and, with everyone’s permission, record the conversation. Medical visits can be overwhelming, and it’s easy to forget important details afterward. Today, plenty of transcription tools can turn those recordings into clear, digestible summaries you can refer back to later. Just be thoughtful about privacy and how any sensitive medical information is stored or shared.

Step Five: Sign the Right Way

The fifth step is small and mechanical, but surprisingly important: when signing your parents’ durable power of attorney, sign them as the agent, not as yourself.

The format looks like this: their name, by your name, as power of attorney. So if Susan Miller is acting for her father Robert, she signs “Robert Miller, by Susan Miller, as Power of Attorney.”

If you only sign your own name, you may be personally on the hook for whatever you signed. For example, imagine signing an assisted living agreement for your aging parent. Sign it as the agent, and it’s clear that the facility’s contract is with your parent and their assets. But sign it as yourself, and you may have just personally guaranteed the bill. It’s a small mechanical detail, but it can make a meaningful financial difference.

The Mistakes Families Make Setting It Up

Ok, so those are the five steps to doing the job well. The last thing I want to cover today is how to set the document up correctly in the first place — because a flawed document, or a shortcut around one, can be almost as painful as no document at all. So before we wrap up, I want to walk through the four common mistakes families make around these documents.

Mistake #1: Using Joint Ownership as a Shortcut

The first mistake is skipping the durable power of attorney completely and simply adding an adult child as a joint owner on the accounts instead. It feels like a shortcut, but joint ownership means the money is now legally partly yours. Your creditors can reach it, so if you’re ever sued, those assets can and likely will be part of the conversation. 

Adding a child as a joint owner can also create gift tax issues, and in some cases, may require a gift tax return, depending on the facts. Becoming an authorized user on an account, or better yet acting as the agent under a durable power of attorney, gives you the access without making their money legally yours

Mistake #2: Naming Co-Agents to Keep Things “Fair”

The second mistake is naming two agents at the same time. And this often comes from a good place, usually when parents with two kids don’t want to pick a favorite. But co-agents create real logistical problems. For example, what happens when they disagree or what happens when a decision is needed today and one of them is traveling? 

And even when the document says the agents can act independently, financial institutions often require signatures from both anyway. A cleaner structure, in most cases, is one agent with the other named as a backup.

Mistake #3: Leaving Critical Powers Out of the Document

Mistake number three is not being intentional about which powers the document grants and there are three in particular that deserve special attention. Those are beneficiary changes, gifts, and digital assets. 

Let’s start with the power to make beneficiary changes. People understandably get nervous granting this power to their agent because it sounds like an invitation to rewrite the inheritance. But picture an adult child trying to consolidate a parent’s scattered accounts at a single institution to simplify things. Well, opening a new account can sometimes mean naming beneficiaries on it — and if the document doesn’t grant that power, a helpful, harmless move gets blocked. 

The good news is you – or your parents – don’t have to choose between safety and flexibility: the durable power of attorney can include language requiring that any beneficiary designations match the existing estate plan, or that no change can benefit the agent beyond what the current plan already provides.

Next is gifts. In states with low estate tax exemptions, lifetime gifting can be a core planning strategy, and the state numbers are lower than many people realize. For example, while the federal exemption currently sits at $15 million here in 2026, Washington’s is roughly $3 million and Oregon’s is just $1 million. 

Know that these figures can and do change, but if gifting is part of you or your parents’ financial plan and the DPOA doesn’t authorize the agent to continue it, that strategy can be disrupted exactly when it matters.

Lastly, digital assets. Newer power of attorney documents usually address these; older ones often don’t. And it’s important to highlight that “digital” covers more than crypto — think photos, music, books, videos, and every account that lives behind a login. If your parents’ document is more than a handful of years old, this alone may be a reason to update it.

Mistake #4: Assuming a DPOA Gives You Control

Ok, the fourth and final mistake is believing that a durable power of attorney naming you as the agent gives you control. It doesn’t.

A durable power of attorney generally does not let you force your parents to do anything when they still have legal capacity. You can’t unilaterally put a competent parent on a budget, hide their money from them, or simply override a decision you think is foolish. In most cases, a durable power of attorney gives you the ability to act alongside them and help carry out their wishes, it doesn’t give you blanket authority over them.

This matters most with fraud and it hits close to home for me. You may recall in a prior episode when I shared the story of my late grandfather falling victim to the infamous “Grandparent Scam.” And what I remember most is the helplessness — watching someone you love get taken advantage of, feel embarrassed by the decision they made, and realizing how limited your options really are.

The reality is, if a parent with legal capacity is determined to send money to someone taking advantage of them, a durable power of attorney gives you very little ability to stop it. It lets you step in and help after things go wrong, but it’s not a tool for preventing a competent parent from making choices you disagree with. Knowing that boundary going in — legally and emotionally — will help you set proper expectations and focus on what matters most.

While You’re at It: Review the Rest of the Plan

One final thing to note before we part ways today. If you’re going to sit down with your parents about a durable power of attorney, you might as well take the opportunity to review the rest of the estate plan in the same conversation.

Look at the will or trust: are the right people in the right roles, and are backups named if someone can’t serve? 

Look at account titling: if an account carries a transfer-on-death or payable-on-death designation, is that intentional — or does it conflict with the careful planning in the will? 

Check the beneficiaries on every retirement account, including the contingent beneficiaries most people never look at. 

Ask whether a healthcare power of attorney and advance directives exist — and more importantly, whether anyone actually knows what quality of life would be acceptable to your parents, because the check-the-box forms rarely cover the gray areas where real decisions get made. 

And if there’s a do-not-resuscitate order, make sure the paperwork is somewhere emergency responders will actually find it.

An estate plan only works if it’s opened, discussed, and updated as life changes — and one that nobody has looked at in fifteen years probably needs some attention.

When in doubt, engage the attorney who drafted the estate documents or hire a new one to review the current plan with a fresh pair of eyes, explain it in simple terms, and propose improvements. 

The Bottom Line

None of this is really about paperwork. It’s about whether the person your parents would want helping them is legally able to when the moment comes.

So here are the questions worth sitting with this week. Do your parents have a durable power of attorney for finances? Is it effective immediately, or does it spring — and does anyone actually know? Has it ever been submitted to a financial institution to confirm it will be accepted? And could you, today, sketch out where their accounts are and how their bills get paid?

If the answer to any of those is no, consider initiating a conversation. It may be an awkward one, but the families who have it while everyone is healthy get a say in how every step of the process goes. The families who wait often end up letting the court system decide instead. 

And if you’re listening to this as the parent — if you’re the one who would be creating and signing the document — then the single best gift you can give yourself and your kids is to have it drafted, reviewed, and discussed before anyone needs it.

Thank you, as always, for listening, and as a reminder, to grab the three estate planning resources mentioned at the top of the episode, just head over to youstaywealthy.com/email. You can also access today’s show notes by visiting youstaywealthy.com/294.

Disclaimer

This podcast is for informational and entertainment purposes only, and should not be relied upon as a basis for investment decisions. This podcast is not engaged in rendering legal, financial, or other professional services.