Why Investing in a Strong Power of Attorney Can Save You Money

At Pettis Webber Pacific, we love sharing practical estate planning insights that can protect your future and save you money. One powerful tool that often flies under the radar is a strong power of attorney (POA). While it may be tempting to grab a free form online or sign something quick at the bank, the truth is, a carefully drafted POA—tailored to your needs and state laws—can make all the difference.

Here are three real-life ways a strong power of attorney can protect your finances—and potentially save you thousands of dollars in the long run.

1. Avoiding Costly Guardianship or Conservatorship Proceedings

Without a valid power of attorney, if you become unable to make decisions for yourself, your loved ones may have no choice but to go through a legal guardianship or conservatorship process. This involves court filings, attorney fees, professional evaluations, and ongoing reporting requirements.

Initial setup can cost anywhere from $5,000 to $10,000, and ongoing oversight can add several thousand dollars each year. These costs can quickly snowball, especially if there are any disagreements among family members. A strong POA eliminates the need for this process by authorizing someone you trust to act on your behalf, both legally and financially.

2. Protecting Assets from Long-Term Care Costs

In Washington, the average monthly cost of long-term care is over $11,000. That’s a serious financial burden for many families. Fortunately, federal and state laws provide strategies to protect assets—especially for married couples—if one spouse needs care.

But here’s the catch: you can’t take advantage of those strategies unless your POA includes the right powers, like the authority to transfer or re-title assets. A boilerplate form may not go far enough. With a strong POA, your agent can act quickly to protect your home and life savings. Without it, your options may be limited—or unavailable altogether.

3. Minimizing Estate Taxes with Smart Gifting Authority

Washington currently imposes estate taxes on estates valued over $2,193,000. If your estate exceeds this threshold, proper planning could help reduce—or even eliminate—your tax liability. But again, timing is everything.

If you’re unable to act due to illness or incapacity, your agent can only take action on your behalf if your POA specifically grants gifting authority. This power allows your agent to make tax-saving gifts within the limits you’ve set. Without this authority, your estate could end up owing tens of thousands of dollars in taxes unnecessarily.

Don’t Leave It to Chance

A power of attorney is not a one-size-fits-all document. It should be drafted with your unique needs in mind—whether that’s planning for long-term care, safeguarding your family home, or minimizing taxes.

If you already have a POA, now is the time to review it. Does it include the powers you might need in the future? And, while you are looking at it, does it name the right people to act for you, and is there at least one alternate?  If you don’t have one yet, it should be at the top of your to-do list.

Let Us Help

Our team at Pettis Webber Pacific is here to help you create a strong, strategic power of attorney that protects you, your family, and your finances. We’ve seen firsthand how thoughtful planning today can prevent hardship tomorrow.

Click here to schedule a consultation. Because the best time to plan is before you need it.