Financial Caregivers & The Roles They Play.
Are you in the process of becoming a financial caregiver for someone—maybe an aging parent? There are a few types of financial caregivers, and each one has different roles, responsibilities, and legalities.
POWER OF ATTORNEY – An individual in need of financial assistance (known as the principal) can give another person (known as the agent) a “power of attorney” that allows them to make decisions on the principal’s behalf. The agent typically manages and has access to the principal’s bank and other financial accounts. If the power of attorney is durable, the agent maintains the powers bestowed upon them if the principal later becomes incapacitated.
TRUSTEE – A trustee is a person named in a trust to manage the trust property on behalf of the beneficiaries. Trust property may include different types of property, such as real estate, financial accounts, or personal belongings. Insurance and retirement accounts can also name a trust as a beneficiary. The trustee is responsible for protecting, managing, and distributing trust assets in accordance with the trust document.
FIDUCIARY – A fiduciary is someone who is responsible for managing someone else’s money or property and owes a higher standard of care to the person acting in this capacity. Conservator – A conservator is a person appointed by a court to manage another’s financial affairs.
REPRESENTATIVE PAYEE – A representative payee is a special type of financial caregiver who is appointed to manage government benefits on behalf of someone else, such as Social Security or VA benefits.
