A will handles what happens after death. The documents that matter more often, and more urgently, are the ones that handle what happens if you are alive but unable to make decisions.
Families discover the gap at the worst possible moment — after a stroke, an accident, or the progression of dementia — when someone needs to pay the mortgage or authorize treatment and has no legal authority to do either.
What Happens Without These Documents
Being someone’s spouse or adult child does not confer legal authority over their finances. A bank will not let you access their account. An insurer will not discuss the policy. A mortgage servicer will not take instructions from you.
The remedy is a guardianship proceeding in the Orphans’ Court, which means a petition, medical evidence, a hearing, a court-appointed counsel for the alleged incapacitated person, and a judicial finding that the person cannot manage their affairs.
It is public, takes months, costs thousands, and strips the person of rights in a formal proceeding. Ongoing court supervision and annual reporting follow.
Sager & Sager can avoid every part of that with documents prepared in an afternoon.
The Financial Power of Attorney
This document appoints an agent to handle financial and legal matters — banking, bills, property, taxes, insurance, and benefits.
Pennsylvania overhauled its requirements, and the current formalities are strict. The document must include a specific statutory notice page, be signed in the presence of two witnesses and a notary, and include an acknowledgment signed by the agent before acting.
Financial institutions reject documents that fail to meet these requirements, and older documents prepared under previous rules sometimes face resistance. A power of attorney that a bank will not honor accomplishes nothing.
Most people choose a durable power of attorney, which remains effective if the person becomes incapacitated. A springing power that takes effect only on incapacity sounds appealing but creates a practical problem — someone has to establish that incapacity before the agent can act, which reintroduces delay at the moment it is least affordable.
Choosing an Agent
This is the most consequential decision in the document, and it deserves more thought than it usually gets.
The agent will have broad authority over your money. The right person is trustworthy, organized, willing to serve, and able to say no to family members who want things done differently.
Geography matters less than it once did, but not entirely — some tasks are easier for someone nearby. Naming co-agents who must act together sounds like a safeguard but often becomes an obstacle, since every transaction requires two signatures.
Name successors. An agent who predeceases you, becomes ill, or simply declines leaves the document unusable if no other agent is named.
The Healthcare Power of Attorney
A separate document appoints a healthcare agent to make medical decisions when you cannot make them yourself.
The authority covers consenting to or refusing treatment, choosing providers and facilities, and accessing medical records. Without it, providers turn to a statutory list of surrogates, which may not reflect who you would have chosen and can produce conflict where family members disagree.
A healthcare agent should be someone who can absorb difficult information under pressure and advocate in a clinical setting. That is not always the same person who would manage your finances well, and it doesn’t have to be.
The Living Will
A living will, or advance directive, sets out your wishes about life-sustaining treatment if you are in an end-stage medical condition or permanently unconscious.
It addresses whether you would want cardiac resuscitation, mechanical ventilation, dialysis, antibiotics and artificial nutrition and hydration in those circumstances.
Its purpose is partly to ensure your wishes are followed and partly to spare your family the guesswork. Adult children asked to make a decision with no guidance carry that decision afterward, sometimes for years. A clear document removes that burden.
It operates alongside the healthcare power of attorney rather than replacing it, since no document can anticipate every situation and someone still needs authority to decide.
Out-of-State Documents
People who move to Pennsylvania frequently arrive with documents prepared elsewhere and assume they remain effective.
Pennsylvania generally recognizes a power of attorney validly executed under another jurisdiction’s law. In practice, though, a document that lacks Pennsylvania’s statutory notice language or doesn’t follow its execution formalities often meets resistance from local banks and providers unfamiliar with it.
Legal validity and acceptance at a bank branch are different, and the latter determines whether the document does its job. Anyone who has relocated to Berks County should have their documents reviewed and, in most cases, replaced with Pennsylvania versions.
Talking About It Matters as Much as Signing It
A document nobody has read is only partially useful. The people named should know they were named, understand what you want, and know where the originals are kept.
Provide copies to your physician and to the hospital system you would likely use. A directive in a safe-deposit box on a Sunday evening is unavailable when you need it.
The conversation is uncomfortable, and it is worth having. Families who discuss these decisions in advance handle a crisis very differently from those who face these questions for the first time in a hospital corridor.
Where Agents Get Into Trouble
An agent under a financial power of attorney is a fiduciary, and Pennsylvania takes the obligations seriously.
The agent must act in the principal’s best interest, keep the principal’s property separate from their own, maintain transaction records, and act within the authority granted by the document.
The most common failures are well-meaning, not dishonest. An adult child paying a parent’s bills from a joint account and their own account interchangeably has commingled funds. One who transfers property to themselves because the parent said years ago that it should be theirs has self-dealt unless the document specifically authorizes gifts.
Pennsylvania requires express authority in the document for certain significant powers, including making gifts and changing beneficiary designations. An agent who does those things without that authority has exceeded their powers, and other family members can and do bring proceedings.
Financial Institutions Sometimes Refuse Valid Documents
A frequent frustration is a bank’s refusal to honor a properly executed power of attorney.
Pennsylvania law provides protections, including consequences for a third party that refuses to accept a valid document without a legitimate basis. Institutions may request an agent certification and, in some circumstances, an opinion of counsel, but they are not entitled to refuse indefinitely.
In practice, persistence and a letter from counsel resolve most of these. Presenting the document to the institutions you actually use while the principal still has capacity is even better, because you can fix problems early. At the same time, you still have time to sign something.
Guardianship Is Still Sometimes Necessary
Even with good documents in place, guardianship can still be necessary.
It becomes necessary when documents were never signed, when the person has already lost capacity and cannot sign now, when an agent is abusing their authority and must be removed, or when decisions are required that fall outside the scope of the documents.
The timing point is what matters. Capacity to sign a power of attorney is required at the moment of signing. A family that waits until a diagnosis has progressed may find the window has closed, and the guardianship they were trying to avoid becomes the only option available.
Keeping Them Current
Review powers of attorney periodically. Agents move, relationships change, and the person you named a decade ago may no longer be the right choice.
Revoking a power of attorney requires notice to the agent and to institutions relying on it. Tearing up your copy is not enough.
If your family has no incapacity documents in place, that gap is most likely to cause real difficulty. Call Sager & Sager, and we will close it.