Help Your Sibling with Financial or Medical Matters

This article discusses how to get power of attorney to help your brother or sister manage their financial and medical affairs. However, they must be the ones to walk through the process of creating a power of attorney.

If you’d like to establish decision-making authority over them without their approval, you will need to establish guardianship or conservatorship through the court system.

What Is a Power of Attorney?

A power of attorney is a legal document where someone (called the principal) names someone they trust as their agent or attorney-in-fact to handle matters for them. A power of attorney is an important estate planning tool, especially if a sibling is incapacitated and cannot manage their affairs. Two types of power of attorney documents cover two essential aspects of your life: your money and your health. A financial power of attorney authorizes an agent to make financial decisions, and a medical power of attorney (also known as a health care directive or living will) authorizes an agent to make medical decisions.

Without these legal documents in place, if your sibling is incapacitated, a family member must petition the court for conservatorship or guardianship over their sibling’s financial and medical affairs. A court hearing is a public proceeding that requires evidence of the sibling’s incompetence and the fiduciary fitness of the potential guardian and conservator.

Medical Care Power of Attorney and Advance Health Care Directive (Living Will)

A directive for medical care varies among the states and may have different names: power of attorney for medical care, health care directive, advance directive, advance health directive, or a living will. Sometimes they consist of two legal documents, the medical care power of attorney and advanced directive or living will. Sometimes the two merge into a single health care directive that contains the power of attorney within the same document. They all operate to provide a principal with the ability to direct their health care and choose an agent while still competent.

A medical directive spells out the principal’s wishes concerning the type and extent of medical care in the event of incapacity or incompetence. For instance, a principal can direct their desire to be kept alive by artificial means and the extent of treatment they want if they have an incurable disease. Again, this is sometimes a separate document or merged with an overall health care directive or medical power of attorney.

The medical power of attorney, or healthcare POA, grants the agent the authority to make medical and health care decisions for the principal according to the medical directive. The agent’s authority can include selecting a nursing home or home care for the sibling’s care.

Overall, these directives and powers spell out the principal’s wishes for treatment and give authority to the agent to carry out these wishes. When discussing this with your sibling, explain that your sibling is in charge of their wishes, and they can express them while they are still competent. Furthermore, it relieves the stress and anxiety of a sibling who is the agent because they know they are carrying out a sibling’s wishes.

Financial Power of Attorney

The financial power of attorney authorizes the agent to manage financial affairs and make financial decisions for the principal. The principal can direct the scope of authority granted under a power of attorney from authority to conduct a single action (called a limited power of attorney) to broad and sweeping authority as allowed under the law (general power of attorney). The principal decides what authority to grant in the POA document, such as the power to:

• Pay bills and expenses
• Engage in real estate transactions
• Pay taxes
• Handle financial matters
• Manage investments and retirement accounts
• Manage bank accounts and insurance transactions
• Operate a principal’s business
• Make gifts to third parties
• Seek elder law or other legal advice on the principal’s behalf

When the Power of Attorney Is Effective

The principal also directs when a power of attorney takes effect. For instance, the principal may desire that a power of attorney does not start until the principal becomes incapacitated or incompetent (a springing power of attorney). Or the principal may want a power of attorney to take effect immediately and continue even if the principal becomes incompetent or incapacitated (a durable power of attorney). Or a power of attorney may take effect only for a specific time or transaction, such as a real estate closing, or to manage the sale of a business. The principal maintains the authority to revoke a power of attorney at any time, provided that the principal is competent at the time of revocation. All power of attorney authority ceases upon the death of the principal.

Regardless of the agent’s powers, the agent must always act in the principal’s best interest, keep accurate records, and avoid conflicts of interest.

Steps to Get a Power of Attorney for Your Sibling

Your sibling must decide to obtain a power of attorney and select an agent. They should choose their own agent without coercion. Explaining the purpose of these estate planning tools and how to use them in the event of incapacity or incompetence will help a sibling understand their value. It will also help a sibling understand that they can dictate their wishes and desires while still competent and able to do so. For instance, a sibling can determine in advance where they wish to receive medical treatment and health care and what assisted living facility to move to receive care. There is great comfort and peace of mind knowing that their agent will carry out their wishes for health care and financial management. Your sibling must be competent to understand and make these decisions. No one must coerce them to choose an agent or direct the type of authority granted. Unfortunately, if your sibling is not competent to make these decisions, you must seek appointment as a conservator or guardian through the court system.

Here are the steps your sibling can take to make you their agent:

1. The Sibling Selects the Agent or Attorney-in-Fact

Your sibling must choose their agent or attorney-in-fact without undue influence from others. It should be someone trustworthy and capable of handling all of the tasks and decisions that come with the responsibility of acting in a fiduciary capacity for their sibling. If there are several siblings in the family, one sibling mustn’t exercise influence or control to coerce a nomination of an agent. It is prudent to nominate a successor agent to act if the primary agent is unable or unwilling to act.

2. The Sibling Chooses the Authority To Give the Agent or Attorney-in-Fact

Generally, a sibling may give the agent the authority to act immediately, with broad powers continuing even if the sibling is incapacitated. As a practical matter, the sibling continues to handle their own affairs until incapacitated or incompetent when the agent takes over. Often, a sibling is competent yet prefers to have the agent take over for convenience.

3. The Sibling Creates Medical Power of Attorney and Living Will and Financial Power of Attorney

Once your sibling has decided to move forward, they can create a medical power of attorney and living will and financial power of attorney using our trusted state-specific power of attorney forms that provide instructions on proper signatures, notary public requirements, and safekeeping suggestions.