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I still don't understand why mom needs cash in MC. Personally I would NOT give my mother ANY cash or leave any valuable items with her/in her room. As you note, "dementia addled residents who toss her room regularly." It isn't really theft, they just don't know any better.

While I agree it IS mom's money, if you are POA it is your responsibility to ensure her funds are managed/handled wisely. Leaving cash with her is not recommended. Any need for money should be requested by the facility (for instance, cost for an outing or some extra care.) I simply don't understand why mom *must* have any money at all. If it is her desire to have cash on hand, use funny money.
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