Power of Attorney and Money: What Every Sibling Needs to Know

Published April 14, 2026 · 5 min read

Mom named your sister as her financial power of attorney three years ago. At the time, it seemed like a practical formality — someone had to be listed, and your sister was the organized one. Now Mom has dementia, the POA is active, and your sister controls every dollar. She makes spending decisions alone, won't share account information, and tells you to "trust her." You do trust her. Mostly. But you'd trust the situation a lot more if you could see the numbers.

Power of attorney is the most powerful — and most misunderstood — document in family caregiving. One sibling gets legal authority over another person's money. The other siblings get anxiety.

What Financial POA Actually Allows

A financial power of attorney gives the named agent authority to manage the principal's (your parent's) financial affairs. The scope depends on how the document is drafted, but typically it covers:

• Accessing and managing bank accounts
• Paying bills and managing expenses
• Filing tax returns
• Managing investments and retirement accounts
• Buying or selling property
• Making gifts (if the POA document specifically authorizes it)
• Applying for government benefits

What it does not allow: anything that benefits the agent at the expense of the principal. The POA holder is a fiduciary — legally bound to act in the parent's best interest, not their own. Using Mom's money to pay your own mortgage is a breach of fiduciary duty. When a sibling uses a parent's money inappropriately, it's a breach of that duty. Using it to pay Mom's aide is exactly what it's for.

A durable power of attorney remains effective even after the parent becomes incapacitated (which is the whole point). A non-durable POA ends when the parent can no longer make decisions — making it mostly useless for caregiving situations.

What Other Siblings Are Entitled To

Here's where it gets tricky. The POA holder is accountable to the parent — not to the other siblings. Legally, your sister doesn't have to show you Mom's bank statements just because you're also Mom's child.

However, most states allow interested parties to petition a court for an accounting. If you have reason to believe the POA holder is mismanaging funds, you can ask a court to compel a detailed report of all financial transactions. This is a formal step, but it's available.

More practically, transparency between siblings prevents problems. A POA holder who proactively shares financial information builds trust. One who refuses invites suspicion — even when they're doing everything right. If you're the POA holder, sharing a monthly financial summary isn't legally required, but it's strategically smart. Nothing kills sibling conflict faster than visibility.

Red Flags to Watch For

Most POA holders are honest people doing a difficult job. But power and proximity to money create risk. Watch for:

• Refusal to provide any financial information. "It's none of your business" is a concerning response to a reasonable question about a parent's finances.
• The parent's care quality declining while assets remain. If Mom has $200,000 in savings but isn't getting adequate care, where's the money going?
• Changes to estate documents. A POA holder should not be modifying the parent's will, trust, or beneficiary designations to benefit themselves.
• Co-mingling of funds. The parent's money should be in the parent's accounts. Transfers to the POA holder's personal accounts are a red flag unless documented as caregiver compensation under a formal agreement.
• Lifestyle inflation. If the POA holder's spending increases noticeably after gaining control of the parent's assets, that warrants a conversation.

How to Set Up POA the Right Way

If your parent hasn't yet set up a financial POA — or if the existing one is bare-bones — here's how to do it in a way that protects everyone:

Use an elder law attorney. A $500-$1,000 attorney fee for a properly drafted POA is a fraction of what a legal dispute over a poorly drafted one will cost. The attorney can customize the document to include reporting requirements, spending limits, and other guardrails.

Consider co-agents. Two siblings named as co-agents means major financial decisions require both signatures. It's slower and less convenient, but it prevents unilateral action and provides built-in accountability.

Build in reporting requirements. The POA document itself can require the agent to provide quarterly or annual accountings to other family members or to a third party (like an attorney or accountant). If it's in the document, it's enforceable.

Name a successor agent. If the primary POA holder can't serve (health issues, moves away, or is removed), a successor takes over without going to court.

If You're the POA Holder

You didn't ask for this job, but you have it. Here's how to do it without destroying your sibling relationships:

Over-communicate. Send a monthly email with account balances, major expenses, and any changes. Five minutes of your time prevents months of suspicion. Even if no one asks for the information — send it anyway.

Keep meticulous records. Save every receipt. Log every transaction. Keep the parent's money in separate accounts from your own. If you ever need to prove you acted appropriately — in court, to siblings, or to Medicaid — your records are your defense.

Don't make major decisions alone. The POA gives you the authority to act unilaterally, but that doesn't mean you should. Selling the house, changing investments, hiring or firing caregivers — these decisions go better when siblings are informed, even if their approval isn't legally required.

Power of attorney is a tool for protecting a vulnerable parent. Used well, it ensures someone competent is managing their money when they can't. Used poorly — or without accountability — it becomes a source of family destruction. The difference isn't the document itself. It's whether the family around it builds a system of transparency or lets one person operate in the dark. For a side-by-side look at tools that help families coordinate, check our caregiving app comparison guide.