When creating a comprehensive estate plan most people use a variety of estate planning tools and strategies. In addition, most people include goals other than simply the division of property upon their death when they create an estate plan. One of those goals is often to plan for the possibility of incapacity. There are a variety of ways to plan for incapacity; however, sometimes loved ones are faced with handling the issue of incapacity after the fact if the incapacitated individual failed to plan ahead. Executing a power of attorney beforehand is one way to plan for incapacity. Petitioning for guardianship is an option after the fact. Understanding the difference between guardianship and power of attorney can help illustrate why it is better to plan ahead.
A power of attorney is a legally binding arrangement that allows the principal to give authority to an agent to act on behalf of the principal. A durable POA will survive the incapacity of the principal. A durable general POA can be used to give a spouse, adult child, parent or other trusted loved one virtually unlimited authority over your estate in the event you become incapacitated. A general POA, however, will often not cover healthcare decisions that may need to be made at some time. To give someone that type of authority you will likely need to complete an advance directive.
While a power of attorney can be included in an estate plan as an incapacity tool, guardianship is an option after a loved one has become incapacitated. To be appointed as a guardian you must petition the appropriate court and notify the required interested parties of the petition. The proposed ward (the person who needs protection) can object to the appointment of a guardian. While guardianship is a more complicated process, it can give the guardian broader powers. It could also, however, only give a guardian very limited powers. You can be appointed as guardian or the person, guardian of the estate, or both. A guardian of the estate looks after the ward’s property and other estate assets while a guardian of the person makes day to day decisions for the ward.
Ideally, you will create an incapacity plan within your overall estate plan that eliminates the need for loved ones to petition for guardianship. You may choose to include some incapacity planning tools such as a trust and/or joint tenancy. If, however, you find yourself struggling to care for an elderly loved one who failed to create an incapacity plan be sure to consult with your estate planning attorney about petitioning for guardianship.
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