Sometimes, there are events in life which make it difficult or impossible to handle your everyday banking needs. If this occurs, you’ll need to compose an authorization to operate a bank account letter. This letter is seen as a legal document that gives someone you appoint, the power to handle your banking needs. This is also known as granting a financial power of attorney, or FPOA.
Types of Financial Power of Attorney (FPOA)
An FPOA can be limited, or durable.
Limited Financial Power of Attorney
This means that you put limits on what the appointed representative can do at your bank. For instance, you might only wish to give them permission to make deposits and withdrawals at only one account. They are to leave all other accounts and safety deposit boxes alone.
Durable Financial Power of Attorney
If you know you’ll either be incapacitated or be abroad for a long while, then you might want your appointed representative to manage all of your financial affairs. Durable financial power of attorney is usually considered long term.
Open a Joint Account
If you wish to avoid all of this, simply transfer a certain amount of cash into a special account, and make it a joint account. Add your appointed representative as a co-owner of the account. This way, they’ll be able to handle transactions and no letter will be necessary.
Contact Your Financial Institution(s)
Whether you are empowering your appointed representative to have access to one account at one bank, or several accounts at different banks, it is important that you first contact each financial institution, to inquire if they have special forms to fill out. If your financial institution does not have a form, simply write the authorization letter yourself.
Below is a basic authorization letter to operate a bank account template:
[Your Full Name]
[Your Full Address]
[Your Contact Information
[Bank Manager Name]
[Address of Bank]
[Subject Line. RE: Authorization Letter to Operate Bank Account, Bank Account #_________]
[Dear Bank Manager Name: ]
I [Your Name], hereby appoint [Appointed Representative] at [Appointed Representative Address], to have access to my savings account only.
This authorization letter to operate bank account Number, # _________, is to authorize [Appointed Representative] to handle banking deposits and withdrawals from this account in my name.
#________________ is the only account I authorize.
I will be out of town for an extended business. This authorization letter to operate bank account #__________ is in effect from [Date] and will extend to [Date].
If, at any time you have any questions or concerns, please feel free to contact me at [Contact Information]. Thank you for your kind attention to the above matter.
[Your Name Printed]
Remember, that this is a general authorization to operate bank account letter template. Depending on the policies of your financial institution(s), you may have to attach copies of forms, or anything else they require.
Once you are finished, carefully proofread the letter for errors. Next, give the original to your appointed representative, or ‘proxy’, and copies to all parties involved, and keep one for your records.
Since this is considered a legal document, it should always be typed in an acceptable business letter format, such as blocked style. Here, all the information you include will be justified to the left, with no indentations, single-spaced, and 2 spaces in between sections. This letter should always be typed, and never hand-written. Check with your state requirements, as you may need to have this letter notarized.
Keep the letter business-like in tone, short and concise. Never leave room for anyone to make their own interpretations. Name all accounts they are to have access to, and name all transactions, accounts, safety deposit boxes, they are not allowed to have access to, if any. However, whether required or not, we strongly recommend that you do have it notarized and/or add a witness.
It’s never easy to realize that you’ll need to compose one of these letters. However, as these are your finances, you must do so and do it with a clear and level head. In other words, don’t be afraid to place limits on what the individual can do. Feel free to contact your lawyer as well, to inform him or her of the FPOA. Finally, always look into your states legal requirements, so everything you do is on the up and up, and no one can take advantage of you. With all precautions taken, you should be able to have peace of mind, knowing your finances will be taken care of in the proper manner, as you requested.