Aaron Charles Gregg

Can Grandchildren Receive Inheritances?

“Children and grandchildren motivate us to think about a will and life insurance. However, it is problematic to name minor children as beneficiaries.”

Wanting to take care of the youngest and most vulnerable members of our families is a loving gesture from grandparents. However, minor children are not legally allowed to own property.  With the right strategies and tools, your estate plan can include grandchildren, says a recent article titled “Elder Care: How to provide for your youngest heirs” from the Longview News-Journal.

If a beneficiary designation on a will, insurance policy or other account lists the name of a minor child, your estate will take longer to settle. A person will need to be named as a guardian of the estate of the minor child, which takes time. The guardian may not be the child’s parent.

The parent of a minor child may not invest and grow any funds, which in some states are required to be deposited in a federally insured account. Periodic reports must be submitted to the court, and audits will need to be done annually. Guardianship requires extensive reporting and any monies spent must be accounted for.

When the child becomes of legal age, usually 18, the entire amount is then distributed to the child. Few children are mature enough at age 18, even though they think they are, to manage large sums of money. Neither the guardian nor the parent nor the court has any say in what happens to the funds after they are transferred to the child.

There are many other ways to transfer assets to a minor child to provide more control over how the money is managed and how and when it is distributed.

One option is to leave it to the child’s parent. This takes out the issue of court involvement but may has a few drawbacks: the parent has full control of the asset, with no obligation for it to be set aside for the child’s needs. If the parents divorce or have debt, the money is not protected.

Many states have Uniform Transfers to Minors Accounts. In Pennsylvania, it is PUTMA, in New York, UTMA and in California, CUTMA. Gifts placed in these accounts are held in custodianship until the child reaches 18 (or 21, depending on state law) and the custodian has a duty to manage the property prudently. Some states have limits on the amount in the accounts, and if the designated custodian passes away before the child reaches legal age, court proceedings may be necessary to name a new custodian. A creditor could file a petition with the court if there is a debt.

For most people, a trust is the best option for placing funds aside for a minor child. The trust can be established during the grandparent’s lifetime or through a testamentary trust after probate of their will is complete. The trust contains directions as to how the money is to be spent: higher education, summer camp, etc. A trustee is named to manage the trust, which may or may not be a parent. If a parent is named trustee, it is important to ensure that they follow the directions of the trust and do not use the property as if it were their own.

A trust allows the assets to be restricted until a child reaches an age of maturity, setting up distributions for a portion of the account at staggered ages, or maintaining the trust with limited distributions throughout their lives. A trust is better to protect the assets from creditors, more so than any other method.

A trust for a grandchild can be designed to anticipate the possibility of the child becoming disabled, in which case government benefits would be at risk in the event of a lump sum payment.

There are many options for leaving money to a minor, depending upon the family’s circumstances. In all cases, a conversation with an experienced estate planning attorney will help to ensure any type of gift is protected and works with the rest of the estate plan.

Reference: Longview News-Journal (Feb. 25, 2022) “Elder Care: How to provide for your youngest heirs”

When Does Someone Need a Guardian?

“Seeking a guardianship for a loved one is a decision that shouldn't be taken lightly. Here's how the process works.”

When a person is legally deemed incapable of managing their own affairs and has not named a financial power of attorney to do so, a guardian or conservator may be needed. A family member may be appointed to the task, as explained in a recent article “What to Do When a Family Member Needs a Guardian” from Kiplinger.

Guardians are usually responsible for personal affairs, while a conservator is generally limited to financial matters. These terms vary by state, so ask the estate planning attorney which ones are most appropriate for your situation. In many cases, one person takes on both roles.

The control over another person’s life and money has been in the news a lot lately. The years-long battle between Brittney Spears and her father showed how things can go wrong, as did the movie “I Care a Lot,” about a professional guardian who steals life savings from elderly people.

It is better for an adult child to care for a parent through the use of Power of Attorney and Healthcare Power of Attorney than having to go to court to gain control through a guardianship. Having these documents prepared while the person still has legal capacity to execute them is far easier and less costly. Guardianship and conservatorship are last resorts when no prior planning has been done.

How does it work? Rules vary from state to state, but generally, a person—referred to as the petitioner—files a petition with a local court to seek guardianship. A judge holds a hearing to determine whether the person in question, known as the respondent, meets the state’s standards for needing a guardian. The respondent has a right to have an attorney represent them, if they do not feel they need or want to have a guardian.

Guardianship does more than give another person the right to make financial decisions for another person. Under guardianship, a person may lose the right to vote, marry, travel, or make certain medical decisions. Courts are often reluctant to take away all of these rights. In many states, courts are allowed to limit the guardian’s authority to managing bills and maintaining a home.

The least intrusive option is preferable, which would be using the Power of Attorney and Health Care Power of Attorney in the first place.

Another point—most courts will not grant a guardianship, if a person is physically disabled but mentally sharp. Making bad decisions, like handling money irresponsibly, or keeping company with people who are potentially preying on a senior, is not enough reason to put someone under guardianship. You cannot always protect someone from themselves.

However, the need for guardianship is clear if a person has suffered a stroke and is in a coma or is suffering from dementia. Other reasons are severe depression where a person cannot function or delirium, when a person is unaware of their environment and confused by everything around them. Delusional disorders are also reasons for guardianship.

When the person meets the standard of need, the courts typically prefer to appoint a family member. However, if there is no appropriate person, a public guardian paid by the state or a professional guardian paid by the family can be appointed.

Filing a guardianship petition can cost thousands of dollars, and a professional guardian can charge upwards of $250 an hour. Most guardians are well meaning, but often run into conflicts with family members. The guardian’s job is to protect the person, not serve the interest of the family. If the family’s sole interest is in protecting their inheritance, the guardian can find themselves in a difficult situation.

Family members serving as guardians can also find themselves in difficult situations. The guardian, whether a professional or family member, must keep meticulous records of any monies spent and the tasks performed on behalf of the person.

The better solution is to prepare in advance with a Power of Attorney, Healthcare Power of Attorney and all of the estate planning documents needed so the family can act without court intervention, the costs of applying for guardianship and the possibility of a professional guardian being appointed.

Reference: Kiplinger (Jan. 25, 2022) “What to Do When a Family Member Needs a Guardian”

What Does It Mean to Be an Adult’s Legal Guardian?

“To say there’s intense international interest over how pop star Britney Spears lost control of her estimated net worth of $60 million, as well as most of her personal and medical decisions, would be a gross understatement.”

The conservatorship battle over Britney Spears’ life and money is not typical of most guardianship and petitions brought by attorneys for families when a loved one is incapacitated and can’t care for themselves or make informed decisions. In most cases, by the time they reach out to an estate planning attorney for help, things have usually taken a turn for the worse.

According to the recent article, “Why the sensational Britney Spears case is atypical of most conservatorships” from Deseret News, families often wait until there is a crisis to start pursuing conservatorship. Starting the process before an emergency would be better, but it is difficult, as the family must face a harsh reality: their loved one has lost the ability to maintain a normal life.

Family members may have Alzheimer’s disease or another type of dementia but have not been formally diagnosed.

Elder financial abuse is also part of the conservatorship problem. If the family is involved in the person’s finances, they may see large checks being written to strangers or spending that doesn’t follow the person’s behavior.

In some states, a guardian controls the person’s living arrangements and medical care, while the conservator controls the person’s finances. Each state has its own laws, so families need to work with attorneys where their loved one resides.

In the Spears case, the court had to see evidence of incapacity, which seems odd for a person who has spent the last 13 years performing and earning millions. However, it is possible for a person to be incapacitated, while still maintaining some degree of functionality.

If Spears’ counsel can demonstrate that she has capacity to manage her own life, health and finances, and if it finds the reasons she needed conservatorship 13 years ago no longer exist, then it is possible the conservatorship will terminate. She will be able to run her life, manage her career and make financial decisions as she sees fit. Those decisions may not be what her father would wish, and there is certainly room for her to make mistakes, just as any other celebrity multimillionaire does.

The LA Superior Court judge suspended Jamie Spears as conservator, appointing a CPA as a temporary conservator until the next court hearing, scheduled for mid-November.

A protected person or an interested party has the legal right to petition a court to terminate a guardianship, if they believe the person is capable of managing their own affairs. Some states have laws serving as a “Bill of Rights” for protected persons, which outline the legal rights individuals have, even when they are under the care of a conservator or guardian.

The best source for information on conservatorship or guardianship is not the entertainment headlines, but from a local estate planning attorney who is familiar with the laws of your state and how this process works for regular people who are sincerely trying to help their family members.

Reference: Deseret News (Sep. 30, 2021) “Why the sensational Britney Spears case is atypical of most conservatorships”

Estate Planning for Special Needs Children

“It takes a special parent to care for a child with special needs. These parents’ greatest financial concern is typically ensuring that their children are cared for when they can no longer do so.”

Part of providing comprehensive estate planning for families includes being prepared to address the needs of family members with special needs. Some of the tools used are trusts, guardianship and tax planning, according to the article “How to Help Clients With Special Needs Children” from Accounting Web. Your estate planning attorney will be able to create a plan for the future that addresses both legal and financial protections.

A survey from the U.S. Department of Health and Human Services revealed that 12.8 percent of children in our country have special health care needs, while 20 percent of all American households include a child with special needs. The CDC (Center for Disease Control) estimates that 26% of adults in America have some type of disability. In other words, some 61 million Americans have some kind of disability.

Providing for a child with special needs can be expensive, depending upon the severity of the disability. The first step for families is to have a special needs trust created through an estate planning attorney with experience in this area. The goal is to have money for the support and care of the child available, but for it not to be in the child’s name. While there are benefits available to the child through the federal government, almost all programs are means-tested, that is, the child or adult with special needs may not have assets of their own.

For many parents, a good option is a substantial life insurance policy, with the beneficiary of the policy being the special needs trust. Depending on the family’s situation, a “second to die” policy may make sense. Both parents are listed as the insured, but the policy does not pay until both parents have passed. Premiums may be lower because of this option.

It is imperative for parents of a child with special needs to have their will created to direct their assets to go to the special needs trust and not to the child directly. This is done to protect the child’s eligibility to receive government benefits.

Parents of a child with special needs also need to consider who will care for their child after they have died. A guardian needs to be named as early as possible in the child’s life, in case something should occur to the parents. The guardianship may end at age 18 for most children, but for an individual with special needs, more protection is needed. The guardian and their role need to be spelled out in documents. It is a grave mistake for parents to assume a family member or sibling will care for their child with special needs. The need to prepare for guardianship cannot be overstated.

The special needs trust will also require a trustee and a secondary trustee, if at some point the primary trustee cannot or does not want to serve.

It may seem easier to name the same person as the trustee and the guardian, but this could lead to difficult situations. A better way to go is to have one person paying the bills and keeping an eye on costs and a second person taking care of the individual.

Planning for the child’s long-term care needs to be done as soon as possible. A special needs trust should be established and funded early on, wills need to be created and/or updated, and qualified professionals become part of the family’s care for their loved one.

Having a child with special needs is a different kind of parenting. A commonly used analogy is for a person who expected to be taking a trip to Paris but finds themselves in Holland. The trip is not what they expected, but still a wonderful and rewarding experience.

Reference: Accounting Web (Sep. 13, 2021) “How to Help Clients With Special Needs Children”

What is the Difference between Conservatorship and Guardianship?

“The term ‘conservatorship’ was suddenly all over the news this year because of singer Britney Spears. However, whether you've been reading up on the topic because of current events or you've been trying to understand it for personal reasons, the legal jargon can be confusing.”

Just as different states have different laws and use different legal terms in estate planning, each state has their own laws and terms about guardianship and conservatorship, explains a recent article from Real Simple, “Everything You Need to Know About Guardianship, Conservatorship, and Legal Dependents.”

Guardianship and Conservatorship mean different things in different states, but both refer to legal proceedings used to make one person, guardian or conservator, responsible and in charge of another person, often known as a ward. In some states, guardianship concerns a ward who is a minor and conservatorship concerns a ward who is an adult. Your estate planning attorney will be able to clarify the rules of your state.

In general, guardianship is not something we like to think about. Who wants to consider two parents dying and leaving a child or children utterly alone? However, if you have children, you must protect them, and you do so by naming a guardian in your will. In this way, your children will be raised by someone you know and trust.

If no guardian is named, the court names a person to raise your children, and there are no requirements for the court to pick a family member.

Guardianship can be contested. People who want to become guardians of children may file a petition in court to become the child’s legal guardian. However, it is easier for all concerned when parents do this in their will or other means allowed by state law.

Conservatorship of an adult is necessary when an adult becomes incapacitated and cannot make informed decisions about medical care, financial or legal matters, or manage daily living. This may occur because of an accident, illness, stroke, or having a mental illness or disability.

An estate planning or elder law attorney files papers with the court to attain the status of conservatorship. Only a court may grant conservatorship after hearing evidence that an adult lacks mental capacity and needs this level of help.

If someone has filed for conservatorship for you, you have the right to retain an attorney and object to the petition or take action to select a different person to act as your conservator.

We also hear the term “legal dependent” used for a few different situations. A legal dependent is a qualifying child or relative who is claimed by a taxpayer on their taxes. They must be under 19 or under 24 if a full-time student. Someone who is legally deemed permanently disabled may be a legal dependent regardless of their age and they don’t have to live with you to qualify. Let’s say you have a parent who has little, or no income and you provide them with more than half (50%) of their total support. You may claim them as a dependent on your taxes.

There are many different situations and rules for guardianship, conservatorship and legal dependents. Meet with a local estate planning attorney to navigate these complex matters correctly, so you may focus on caring for loved ones.

Reference: Real Simple (Sep. 20, 2021) “Everything You Need to Know About Guardianship, Conservatorship, and Legal Dependents”

Choose Wisely and Protect Yourself When Naming a Power of Attorney

“Children may have moved away or lost touch. Old contacts may have died or become disabled. You cannot trust everyone and criminal cases based on misuse of a power of attorney do exist.”

Deciding who to name as your power of attorney, or “agent” is not an easy decision. However, it is a necessary appointment, says this article “Ways to protect yourself when appointing a power of attorney” from The Mercury. Disaster and disability strike without advance notice, so it’s important to make this decision while you are well and can think it through.

If you don’t have a power of attorney in place and the unexpected occurs, the only way for your family to obtain legal authority to act on your behalf is through a guardianship procedure. Even when not contested, guardianship is expensive, time consuming and can limit personal freedom. Not every court will award guardianship to a family member, so the end result could be a stranger taking control of your decisions and property.

Having a power of attorney is a far better alternative, but there are seniors who are concerned about the power of a POA and how it might be abused. Here are some tips to keep you in control of your life even with a POA:

Choose wisely when you are well. Choose your agent when you are of sound mind and body. A common “test” is the checkbook test: could you, right now, hand this person your checkbook without a second thought? Do you believe this person would act responsibly, in your own best interest, follow through in paying bills, ask for help in areas they may not understand, record transactions and be scrupulously honest? If you hesitate to give them your checkbook today, you aren’t likely to trust them to run your life in the future.

Many people choose an agent based on whether the person is the oldest child or if there would be hurt feelings if the person was named. These are not good reasons. A person who has problems managing money, for whatever reason, is not a good candidate. Their own stress might make access to your funds too great to resist.

Name a secondary Power of Attorney. There should always be a back-up person named, if the person you name is not able to serve. The same goes for trustees and beneficiaries. Discuss these alternatives with your estate planning attorney to ensure the attorney knows the identities of the primary and secondary choices.

Have a Power of Attorney customized to your personal needs. Not all Powers of Attorney are the same, and one that is great for a friend may be a disaster for you. Limited powers, unlimited powers, powers to gift or powers only for a specific task or period of time are all options when creating a Power of Attorney. You may have a business to run or a partnership to dissolve. Gifting might be permitted to limit estate taxes, if that is your wish. Limited gifting generally means $15,000 a year, although your estate planning attorney can provide guidance on how to best structure gifting for you. If you own life insurance policies, you may want to permit your agent to cash in insurance policies but not allow the agent to change the named beneficiaries.

Two agents or one agent? Not all banks or investment companies will accept two agents. If they do, will the two people you select be able to work together? If not, naming two could create a financial and legal firestorm.

Financial Power of Attorney and Health Care Power of Attorney can be two separate roles. One person might be terrific with managing money, while another could be better at understanding and managing healthcare providers. Naming different people for each task will allow both to participate in caring for you and draw on their unique skillsets.

Fire when necessary. You always have the right to remove someone from their role as your agent. Your attorney will know how to do this properly to protect you and other agents.

Reference: The Mercury (Aug. 3, 2021) “Ways to protect yourself when appointing a power of attorney”

Do I Need to Update My Estate Plan?

“Even though it is critical for your assets, family and legacy, estate planning tends to fall to the bottom of people’s to-do lists. What new parent wants to draft a will, while finalizing a nursery paint color?”

Given a choice, most people will opt to do almost anything rather than talk about death and life for others after they are gone. However, estate planning is essential to ensure that your life and life’s work will be cared for correctly after you’ve passed, advises the article “Is Your Estate Plan Up to Date?” from NASDAQ.com. If you own any assets, have a family, loved ones, pets or belongings you’d like to give to certain people or organizations, you need an estate plan.

Estate planning is not a set-it-and-forget it process. Every few years, your estate plan needs to be reviewed to be sure the information is accurate. Big life changes, from birth and death to marriage and divorce—and everything in between—usually also indicate it’s time for an update. Changes in tax laws also require adjustments to an estate plan, and this is something your estate planning attorney will keep you apprised of.

Reviewing and updating an estate plan is a straightforward process, once your estate planning attorney has created an initial plan. Keeping it updated protects your wishes and your loved ones’ futures. Here are some things to keep in mind when reviewing your estate plan:

Have you moved? Changes in residence require an update, since estate laws vary by state. You also should keep your advisors, including estate planning attorney, financial advisor and tax professional, informed about any changes of residence. You’d be surprised how many people move and neglect to inform their professional advisors.

Changes in tax law. The last five years have seen big changes in tax laws. Estate plans created years ago may no longer work as originally intended.

Power of Attorney documents. A Power of Attorney authorizes a person to act on your behalf to make business, personal, legal and financial decisions. If this document is old, or no longer complies with your state’s laws, it may not be accepted by banks, investment companies, etc. If the person you designed as your POA decades ago can’t or won’t serve, you need to choose another person. If you need to revoke a power of attorney, speak with your estate planning attorney to do this effectively.

Health Care Power of Attorney and HIPAA Releases. Laws concerning who may speak with treating physicians and health care providers have become increasingly restrictive. Even spouses do not have automatic rights when it comes to health care. You’ll also want to put your wishes about being resuscitated or placed on artificial life support in writing.

Do you have an updated last will and testament? Review all the details, from executor to guardian named for minor children, the allocation of assets and your estate tax costs.

What about a trust? If you have minor children, you need to ensure their financial future with a trust. Your estate planning attorney will know which type of trust is best for your situation.

A regular check-up for your estate plan helps avoid unnecessary expenses, delays and costs for your loved ones. Don’t delay taking care of this very important matter. You can then return to selecting a color for the nursery or planning your next exciting adventure. However, do this first.

Reference: NASDAQ.com (July 28, 2021) “Is Your Estate Plan Up to Date?”

Powers of Attorney and Advance Directives

“Some people think that, because their assets are jointly owned with a spouse or are in a trust, they do not need a Power of Attorney, or that if they become incapacitated, their spouse automatically has the authority to make medical decisions on their behalf.”

A medical crisis only gets worse, when you learn you don’t have legal authority to make medical decisions for a loved one, or find out after a loved one is incapacitated that you can’t gain access to assets in their trust. You need to have certain estate planning legal documents already in place, according to the article “Tips you should know for Powers of Attorney and Advance Directives” from seacoastonline.com.

Power of Attorney. The power of attorney (POA) allows one person, the “principal” to appoint another person as their “agent” (also known as an “attorney in fact”). The agent has the authority to act on behalf of the principal, depending on the powers described in the document. Each state has its own laws about who can be an agent, if more than one person can be appointed as agent and if there are any limits to what power can be given to an agent. Your estate planning attorney will be able to create a POA to suit your situation.

A POA can be created to give extremely broad powers to an agent. This is sometimes called a “general” POA, where agents can do everything that you would do, from accessing and managing bank accounts, applying for Social Security, to filing tax returns. A POA can also be limited in scope, known as “limited” POA. You could permit an agent to only sign a tax return or conduct a specific transaction.

In most estate planning scenarios, the POA is “durable,” meaning the named agent can continue to have authority to act, even if the principal is incapacitated after the documents have been executed. This makes sense: a durable POA generally avoids having to go to court and have a guardian appointed. The person you have selected will be the POA, not a court-appointed person.

Advance Directive. The advance directive allows a person to appoint another person to make medical decisions on their behalf if incapacitated. In some states, this is called a durable power of attorney for health care, and in others it is referred to as a health care proxy.

In most cases, the advance directive becomes effective when one or more treating physicians determine the person no longer has capacity to make or communicate health care decisions. Having this document in place avoids having to go to court to have a guardian appointed. If time is of the essence, any delay in decision-making could lead to a poor outcome. If there is no advance directive and physicians have decided you are unable to make these decisions, they go by a hierarchy of relatives to make the decisions for you. If you have an estranged adult child, for instance, but they are your next-of-kin, they could be the one making decisions for you.

If you have children who recently became legal adults (usually age 18), these documents will protect them as well, since just being their parent does not provide you with the right to make these decisions.

Reference: Seacoastonline.com (June 27, 2021) “Tips you should know for Powers of Attorney and Advance Directives”

What Is the Process of Conservatorship?

“A conservatorship, also known as a guardianship, is a legal mechanism set up for people who are unable to manage their affairs.”

The headlines surrounding Britney Spears’ fight against her father’s conservatorship have kept the issue in the public eye. It’s how her father controls her finances and her life, dating back to 2008 when she suffered a very public mental health crisis. Her $60 million fortune is controlled by her father Jamie Spears, according to the article “Britney Spears Is Under Conservatorship. Here’s How That’s Supposed to Work” from npr.com. In this case, only her father has the ability to negotiate business opportunities and other financial arrangements.

Britney made a passionate plea before a Los Angeles Superior Court judge to end the conservatorship, saying she is exploited, unable to sleep, depressed and cries daily.

Her conservatorship was set up because of the court’s agreement in 2008 with her father that she was no longer able to manage her own affairs. The judge appointed Jamie Spears, known as the “conservator” to care for another adult (the “conservatee”), who is deemed to be unable to care for themselves.

The conservatee does not lose all rights. They may still take part in important decisions affecting their property and way of life. They have a right to be treated with understanding and respect, and they have basic human rights. However, the court is saying that decisions about where to live and how to support the person need to be made by someone else. This is an extreme situation and is usually done only as a last resort. Once the court has appointed a conservatorship, only a court can lift it.

Conservatorships are usually used for people with a severe cognitive impairment or older people with severe dementia. Guardianships are also appointed for individuals with severe developmental disabilities. Spears is not the typical person under conservatorship. In the last 13 years, she has released albums, judged on The X Factor and earned an estimated $148 million performing in Las Vegas. Spears told the court she should not be in a conservatorship, if she can work and provide money and pay other people.

Many reforms to guardianship laws have taken place, including one principle that guardianship should only extend to the areas of the person’s life they are not able to manage. However, the Spears’ conservatorship includes every aspect of her personal affairs, as well as her property management.

Individuals under guardianship don’t select their guardian, but they may in some instances make recommendations and requests. The court is supposed to give serious consideration to their requests. The court does not seem to be recognizing this or other changes in Britney Spears’ case. She has been asking since 2014 for her father to be removed from his prime role in the conservatorship, and in 2020 she asked the court to suspend her father from his role entirely.

Family members are usually named as guardians, but there can be bankers, or professional guardians named. A wealth management company was added to Spears’ conservatorship in recent months as a co-conservator, but her father remains in charge of all aspects of her life.

Ending a guardianship is difficult, unless the guardianship has been set up for a specific length of time. If there’s a lot of money involved, things can get complicated. The guardian may not agree to steps to modify the guardianship because they will lose income. There’s a real conflict of interest in this case, as Spears’ father is also her business manager.

There is a trend towards avoiding guardianship and having a person or a handful of people who can help with decision making, while permitting the person to be involved in some way. However, the Britney Spears case is unlike any conservatorship case.

Reference: npr.com (June 24, 2021) “Britney Spears Is Under Conservatorship. Here’s How That’s Supposed to Work”

How Does Guardianship Work?

“As a result of illness, old age or incapacity, what may happen when you can no longer handle your own decision-making, handle your own money or make your own health care choices? Who can step in to help and how are they empowered?”

For the most part, we are free to make our own decisions regarding how we live, where we live, how we spend our money and even with whom we socialize. However, when we are no longer capable of caring for ourselves, most commonly due to advancing age or dementia, or if an accident or illness occurs and we can’t manage our affairs, it may be necessary to seek a guardianship, as explained in the recent article “Legal Corner: A guardian can be a helpful tool in cases of incapacity” from The Westerly Sun. A guardianship is also necessary for the care of a child or adult with special needs.

If no proper estate planning has been done and no one has been given power of attorney or health care power of attorney, a guardianship may be necessary. This is a legal relationship where one person, ideally a responsible, capable and caring person known as a guardian, is given the legal power to manage the needs of a ward, the person who cannot manage their own affairs. This is usually supported through a court process, requires a medical assessment and comes before the probate court for a hearing.

Once the guardian is qualified and appointed by the court, they have the authority to oversee everything about the ward’s life. They have power over the ward’s money and how it is spent, health care decisions, residential issues and even with whom the ward spends time. At its essence, a guardianship is akin to a parent-child relationship. 

Guardianships can be tailored by the court to meet the specific needs of the ward in each case, with the guardian’s powers either limited or expanded, as needed and as appropriate.

The guardian must report to the court on a yearly basis about the ward’s health and health care and file an annual accounting of what has been done with the ward’s money and how much money remains. The court supervision is intended to protect the ward from mismanagement of their finances and ensure that the guardianship is still needed and maintained on an annual basis.

The relationship between the ward and the guardian is often a close one and can continue for many years. The guardianship ends upon the death of the ward, the resignation or removal of the guardian, or in cases of temporary illness or incapacity, when the ward recovers and is once again able to handle their own affairs and make health care decisions on their own.

If and when an elderly family member can no longer manage their own lives, guardianship is a way to step in and care for them, if no prior estate planning has been done. It is preferable for an estate plan to be created and for powers of attorney be created, but in its absence, this is an option.

Reference: The Westerly Sun (Sep. 19, 2020) “Legal Corner: A guardian can be a helpful tool in cases of incapacity”