My mother is in hospice and she has a CD with a charity being the beneficiary. I have POA and am the Executor of her will.
Can I legally move the CD to a checking account to pay for her funeral and final expenses? If so, what happens to the beneficiary listed on the CD?
Do I have the right to do this as the Executor, or POA since the POA is no longer valid once she passes? I'm worried after she passes I can no longer change the CD. The POA has not been used yet.
She has a checking account with me as the beneficiary but there is not enough in it to pay her expenses as it is what's being used now.
Thank you for your support.
The last time I had a CD it could not be cashed out until the end of the “contract”. If it is a 12 month CD (for example) I don’t think you can do anything until that time period is up.
I would head to the bank or call and talk to someone to find out what can be done.
I would think any monies that a beneficiary would get would be after all outstanding expenses are paid.
As to whether a bank will let you do it is another thing. There may be limits to what your POA entitles you to do, and banks are notoriously crunchy about accepting POAs not written on their forms. I'd get with the bank people ASAP to get that straightened out. Once you're a POA to their satisfaction, then you can ask about cashing out the CD. The penalty will likely be sacrificing the interest earned so far this year.
I have a General POA but i would hope being the Executor of her estate would allow me to cash out the CD. When my father passed i didn't have to do much.
Yes, you need to deal with this ASAP. Once she dies, your POA ceases to exist. Once she's gone, that CD belongs to the beneficiary.
Get into the bank with POA in hand and talk to the manager. You also need some proof (doctor's note) of your mom's inability to handle her affairs or Mom herself coming with you to give permission to you to take over her financial affairs. Simply having a POA doesn't make it in effect. The person granting it (Mom) has to be found incompetent, or she has to voluntarily let you take over.
Talk to the bank manager. Don't expect this to be resolved on the first trip. Banks are extremely protective of the customers' accounts, so you have some hoops to jump through.
You mother should change the beneficiary, either to you or to the funeral home that you will be using if the amount is equal to or less than the cost of their services.
IMO, that money is your mothers do with it as she wishes before her death. Beneficiary is assigned so its not part of her estate.
However, wills, typically provide that all the debts of final illness must be made before any disbursements can be made to heirs. That would mean that funeral expenses are a higher priority than the charitable bequest.
W/o knowing the specific designation of entitlement, and if your authority under a POA or DPOA authorizes changes that designation, it's not easy to provide an answer to your question.
I would contact the attorney who prepared both documents, and specifically ask, or confirm, that funds for your mother's last illness takes a higher priority than the CD. (I would do that today.)
If i understand a POA correctly once she passes it can no longer be used that is my worry about the CD if i wait to long as her current health is not bad enough to get a DR's note to use POA.
She does not want to plan her funeral or pay in advanced as i have tried a few times. She wants me to use her checking account as i am the Beneficiary of that but it will not have enough money.
Older folks seem to forget how costly things are these days. She still drives and refuses any help but she gave in and took hospice help right now they only come by once a week to check on her.
Thank you all for the support in a difficult time.
Is your mother no longer competent to act in her own best interest? If so, you as her POA can act in a way that benefits her best if that is what is written in your POA document.
As POA for my brother, and as Trustee of his Trust I was able to do whatever I thought best when his CDs came due. One of them went to his friend on his death, but I instead transferred it to his account, where the money was needed for his ALF expenses. When his small home was sold I was again able to open a CD in his name, POD to the friend he wanted to inherit that amount.
As to closing a CD, you may well lose interest on it, but if you are certain that money may be needed now or after death for your mother I would imagine you can close it.
You do understand, I know, that you are there to honor your mothers NEEDS first, and wishes in so far as you are able to, so I will leave what you do with that money not needed for funeral expenses to your own moral compass, telling you that you have a fiduciary responsibility to your Mother, and that if you change things around without need, knowing that meticulous records of exactly what you do needs to be kept--well I leave it all to your own moral compass. The money should remain in your Mother's name. You would not be able to access that unless you PREPAY her funeral now. Unless you already know that you are the executor of any will as well as current POA. And given that all takes time, probably prepaying the funeral, then putting the remainder in a CD as she had it, with the charity POD, is your best and most honorable step forward.
I would suggest that you do check with a lawyer. That is something that can come out of your Mom's account as well as your question regards her estate.