When Priscilla Jackman spotted a great rate on a certificate of deposit at PNC Bank, she thought the CD would be ideal for her 88-year-old mother, Irene. She drove to the PNC branch near her home in Pittsburgh, taking with her the power of attorney her mother had granted several years earlier.
Jackman was surprised and annoyed when the bank refused to accept the document and told her that her mother would have to sign for the account in person. A review of the power of attorney by the bank's legal department failed to resolve the problem. "The power of attorney specifically says that I can act on her behalf in banking matters," says Jackman. "What gives?"
Jackman's experience, it turns out, is not uncommon. Increasingly, banks and other financial institutions, including PNC, require you to fill out their own powers of attorney. Or, like Vanguard, they may require your lawyer to recertify that your document is still in effect before you can open an account. "It's for the protection of the person who has given the power of attorney," says Vanguard's Ellen Rinaldi.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
T. Rowe Price will accept a power of attorney, but only an original, unless it has been recently drawn up or recertified. "These things are so powerful," says Christine Fahlund, of T. Rowe Price. "You can empty someone's accounts." Laura Horton, the lawyer who drafted Jackman's document, sums up the situation: "Everybody is running scared because they're afraid they're going to be sued."
Contact each company. It's not that Jackman's document was invalid. "A thorough power of attorney should be honored by any brokerage firm or bank," says Suzanne Snedegar, a lawyer in Bethesda, Md. "But every company wants you to use its own form. When I run into that problem, I speak to the bank's legal department and get it resolved." The catch, of course, is that your lawyer's time can cost you money.
A better solution: When a family member grants you power of attorney, ask the financial institutions with which you plan to do business to send you their own forms to be filled out at the same time. "It's best to have all of your investments in one or two banks or brokerage firms anyway," says Martin Shenkman, an estate-planning lawyer in Teaneck, N.J. Otherwise, assets are more apt to be misplaced or even pilfered. The problem, as in Jackman's case, is that this doesn't always allow you to take advantage of the best deals on financial products as soon as they come up. Lest you waste a trip, contact the financial institution ahead of time to ask about its policy.
-
Strategies to Optimize Your Social Security BenefitsTo maximize what you can collect, it’s crucial to know when you can file, how delaying filing affects your checks and the income limit if you’re still working.
-
Don’t Forget to Update Beneficiaries After a Gray DivorceSome states automatically revoke a former spouse as a beneficiary on some accounts. Waivers can be used, too. Best not to leave it up to your state, though.
-
Best Banks for High-Net-Worth Clientswealth management Kiplinger's 2023 list of the best banks for higher-net-worth clients.
-
Stock Market Holidays in 2024: NYSE, NASDAQ and Wall Street HolidaysMarkets When are the stock market holidays? Take a look at which days the NYSE, Nasdaq and bond markets are off in 2024.
-
Stock Market Trading Hours: What Time Is the Stock Market Open Today?Markets When does the market open? It's true the stock market does have regular hours, but trading doesn't necessarily stop when the major exchanges close.
-
Bogleheads Stay the CourseBears and market volatility don’t scare these die-hard Vanguard investors.
-
I-Bond Rate Is 5.27% for Next Six MonthsInvesting for Income I-Bonds issued November 1, 2023 through April 30, 2024 will have a rate of 5.27%.
-
What Are I-Bonds?savings bonds Inflation has made Series I savings bonds enormously popular with risk-averse investors. So how do they work?
-
This New Sustainable ETF’s Pitch? Give Back Profits.investing Newday’s ETF partners with UNICEF and other groups.
-
As the Market Falls, New Retirees Need a Planretirement If you’re in the early stages of your retirement, you’re likely in a rough spot watching your portfolio shrink. We have some strategies to make the best of things.
