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Help Me Retire: I’m 66, single with no family, and am afraid of becoming incapacitated with no one to handle my affairs – who should I turn to?

Dear MarketWatch, 

I’ve not seen this addressed anywhere but I am hopeful there are some resources.

As a single person without family I have a concern that I could become incapacitated and unable to handle my affairs. I want to designate someone to have a durable power of attorney. But who could possibly do this for a reasonable cost? Are there any companies or services that do this? I would like someone who can manage my assets and manage my care if I become unable to do so. 

My attorney said she could do it but it would be $300 per hour. That will quickly deplete resources. Even if she only spent 20 hours a month, at that rate it would be an additional $72,000 that I’d not budgeted. Would long-term care insurance cover this expense? 

What do you suggest single people do? My friends are about my age (66) and could not do it.

See: I retired at 50, went back to work at 53, and then a medical issue left me jobless: ‘There’s no such thing as a safe amount of money’ 

Dear reader, 

This is such an important question and I’m glad you’ve raised it. Having your affairs taken care of should an emergency happen is incredibly important, whether you’re single or married, have kids or not. You worked hard for your savings, and your assets should be used as you wish to take care of you in the event of incapacitation or thereafter. 

As you know, a power of attorney is a great way to accomplish this goal. These documents give someone the legal right to act on your behalf, and they can be structured in a way to have broad or limited responsibilities. For readers who are not aware, a durable power of attorney remains effective when someone becomes incapacitated, whereas a nondurable power of attorney ends at that point. They’re not just for worst-case scenarios – a couple who owns a home and rental properties and wants to take a year off to sail around the world could also appoint a power of attorney to handle their bills while they’re away, said Dan Hawley, founder of Hawley Advisors. 

As you have found, having a professional with this power can be expensive. Some, like your attorney, charge per hour, while others may charge a flat fee on a monthly basis, according to elder law firm Unruh, Turner, Burke & Frees.

But truth be told, you might find you’d have to pay even if you didn’t work with a professional. Family members and friends may also be paid to take on this role, though the principal and agent can discuss a fee structure that works for everyone. 

Want more actionable tips for your retirement savings journey? Read MarketWatch’s “Retirement Hacks” column 

If you want a professional to act as your power of attorney but your lawyer’s rates are too high, shop around. It doesn’t hurt to ask friends for suggestions, then vet those professionals to see if they meet your standards and your price limits. Also ask your attorney or other professionals how much time, on average, they spend taking care of the affairs of their incapacitated clients – you mentioned 20 hours, but it could be significantly less than that. 

There are other options, such as a trust company, but those are usually for especially large estates, said George Gagliardi, a certified financial planner at Coromandel Wealth Management.  You may find better luck with a more reasonable rate if you stick with an individual who is capable and follows his or her fiduciary duty.

Also, to answer your question about long-term care insurance – I do not believe the fees for acting as power of attorney are covered. That type of insurance takes care of your medical and custodial needs, such as the services you’d find at a nursing home or the aides you’d have working for you at your home. But since it does help pay for your medical needs, it could potentially leave you with more money in your pocket to hire a professional you trust for your financial affairs. 

I suggest also working with a financial adviser, who can create a financial plan for you that incorporates your goals and needs for the next 40 years and accounts for the worst-case scenario. A planner could also look over your insurance coverage and help you make sense of how to pay for the services you want.

Back to who to pick: You mentioned your friends are around your age and couldn’t do it, but did you ask them? “In the absence of hiring a professional fiduciary (or having one lined up), I encourage my clients without large families or if family members are unsuitable for the role, to cultivate a circle of trusted friends and associates who can act as each other’s back up by your mid-60s to 70s,” Hawley said. 

Also see: My wife and I will have $250,000 in a retirement emergency fund – what’s the best way to store that cash?

Younger family members, even if they’re more distant, are also viable options if you trust them, such as nieces or nephews, or children of close friends, said Howard Pressman, a certified financial planner at EBW Financial Planning. “Tell them you are willing to provide for them in your will if they are willing to assist you in your old age,” he said. 

Of course, the ideal candidate would be younger, financially focused and organized. And in that case, you may think of two people who could take on coordinating roles, such as dual power of attorneys (though you’d have to explicitly state in your documents who handles what), or one person taking the role of executor of the will and another as agent for a healthcare advanced directive. 

By the way – I know you asked about a power of attorney, but make sure to have other documents too. For example, having medical documents in place is crucial. A living will is used to share your wishes with medical personnel about how you’d like to be treated, or if you want them to go to extreme measures to keep you alive, Pressman said. 

A HIPAA release form, Hawley said, lets medical facilities release important information about patients to others, and without this, your friends can have a hard time finding out if you’re OK or how to help. 

Readers: Do you have suggestions for this reader? Add them in the comments below.

Have a question about your own retirement savings? Email us at HelpMeRetire@marketwatch.com

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