Everything You Should Know About Guardianships
A guardianship is a relatively common legal process that occurs when someone is no longer able to properly manage their own affairs. At the moment, there are roughly 1.3 million guardianships that are currently active. Before you establish a guardianship, you should know what this process entails.
What Is a Guardianship?
Guardianship is a standard legal process that can be instituted to protect an individual who is unable to manage their own affairs in whole or in part by allowing a guardian to make some or all decisions for that person. Keep in mind that this legal process can be highly invasive and may take away some of the ward’s rights.
Can a Guardianship Be Helpful?
Guardianships do have their benefits. For one, putting a guardianship in place means that the person under the guardianship who can’t properly manage their affairs can’t be exploited and that they are properly taken care of. This process can also be used to ensure that someone’s assets are used for their benefit and that their estate plan is not negated by someone else.
A guardianship could prevent these issues from occurring in the first place. If someone close to you is no longer able to manage their affairs, our New Jersey estate planning lawyer can guide you through your options.
Alternatives to Consider
Because a guardianship is invasive and can deprive a person of their rights, a person considering seeking guardianship may want to consider other less intrusive alternatives. These might include everything from a power of attorney or a conservatorship if the individual still has capacity to a limited guardianship if the individual has capacity in some areas but not others.
A limited guardianship removes the person’s right to make their own decisions in limited areas. For example, a limited guardianship could be used to manage finances or to manage any medical decisions but not to determine where an individual lives or who he or she sees if they can still make that decision.
A court approval must still take place even though this guardianship is more limited than a full guardianship. The legal process will remain in place as long as the individual in question is incapacitated. Courts will seek to limit a guardianship if possible to ensure that a person in need of assistance is subject to the least restrictive means possible. Any guardianship can be dissolved if the incapacitated person regains capacity. This will need to be done by a court procedure.
As for a power of attorney, this can be created for the handling of financial or medical decisions. It’s much easier to create a power of attorney when compared to a guardianship. When it comes to a financial power of attorney, this process is typically done by placing a second person’s name on the affected individual’s bank account.
A person who is named under a medical POA can make decisions to protect the subject’s well-being and health. In fact, this person can seek a mental incapacity declaration for the subject in question. The main difference between a POA and a guardianship is that a POA can be canceled at any time and doesn’t require a formal court approval.
Yet another alternative at your disposal involves assisted decision-making, which is a type of agreement that allows someone to act as a decision-maker for financial transactions. When making this agreement, the bank will first need to be notified of every detail surrounding the arrangement, after which the surrogate will receive alerts about any strange or unusual transactions that might occur.
Keep in mind that the main account holder still retains control over their account and will be able to use it as needed. By creating an assisted decision-making agreement, the main account holder’s financial livelihood becomes more secure. The surrogate decision-maker will be able to keep an eye on the account to make sure that fraud or exploitation is kept at bay. When an unusual transaction is detected, the surrogate decision-maker will be tasked with providing an additional approval before the transaction can go through.
It’s also possible to create a trust in lieu of a guardianship. This provides individuals with the opportunity to detail what steps should take place once they become incapacitated. Setting up a trust allows for a guardianship to be avoided if a relative or friend is appointed to make decisions regarding assets and the estate. In this situation, a contingent trust will allow assets to be managed.
If you believe that appointing a guardian is necessary for your loved one or want to have a current guardianship removed, call our New Jersey estate planning lawyer today at (201) 996-1200 to schedule an appointment or discuss your options.