What Is Guardianship & Incapacity Planning?

After I explain the “ins” & “outs” of what Guardianship entails to my clients; most, if not all of them want to avoid it. Guardianship strikes infinitely more fear in my clients than does Probate – BY FAR. So what is Guardianship? For purposes of Elder Law, it is the Circuit Court process of having a person legally declared “incapacitated” by a Circuit Court Judge. And for better or for worse, once the Judge makes that declaration, some or all of the “incapacitated” person’s rights are lawfully vanquished, and in turn, vested in the Proposed Guardian. And from that point forward, the Guardian has absolute authority in SOLELY exercising those rights. In other words, some or all of the incapacitated person’s rights are indeed legally taken and given to the Guardian.


Sometimes Guardianship is absolutely necessary. As one of life’s more unfortunate elements, some of us will ultimately experience a diminishment of mental capacity as we age.  If that occurs, we can easily be taken advantage of in a host of ways. Financial exploitation is the main culprit, and it’s usually done to an elderly person by means of (1) unduly influencing him/her to execute a new estate plan that runs contradictory to what his/her wishes were before incapacity; (2) convincing an elderly person to gift imprudent amounts of money out of his/her estate; or (3) by fraudulently using a Power of Attorney document, a wrongdoer can invade an incapacitated elderly person’s finances for the purpose of stealing from such.


Also, when our capacity diminishes, often times we are unable to handle our health care affairs. This could entail being unable to make proper decisions with regard to our living conditions and/or social welfare, being unable to manage our prescription medication regime, or just simply not being able to understand what our physician is prescribing and/or recommending.


Clearly, in the forgoing examples, Guardianship may be the only solution to stop such wrongdoing and inadvertent self-neglect. The benefit of Guardianship is that it not only stops the “on-goings” in the herein described negative hypotheticals, but that same Judge who made the Declaration of Incapacity also makes sure the Guardian is handling the incapacitated person’s financial & health care affairs prudently as prescribed by law. But as described heretofore, Guardianship is not only invasive, it also comes with a hefty price tag. With the exception of a few caveats, the incapacitated elderly person’s estate pays for ALL the expenses associated with the Guardianship; including Attorney Fees – thousands of dollars in most circumstances!


So how can you avoid Guardianship? If you have trustworthy people in your life {preferably your spouse and/or child(ren)}, you can do your INCAPACITY PLANNING by executing a Durable Power of Attorney Document. In that document, you can name trusted people to manage your finances in the event of incapacity -- outside the expense & invasiveness of Guardianship Court. You can also execute a Healthcare Surrogate and perhaps a Healthcare Power of Attorney to do the same, but with regard to management of your health care & medical affairs in the event of incapacity. A Revocable Living Trust can also be an excellent Incapacity Planning Tool when it comes to protecting your finances against incapacity, in that your Successor Trustee can manage all assets you’ve placed in Trust, outside the reach of Guardianship Court, while simultaneously being responsible for accounting for those assets.