Planning Ahead
Planning Ahead: Conservatorship, Guardianship & Power of Attorney
and continuing today, most of us can expect many more years of productive life. The less attractive side of this development is that we can also live to ages at which we will experience some degree of disability. There are simple, inexpensive ways to prepare for the possibility of needing help with business matters and personal care, but unfortunately, many people reach the point of disability with no plan in place.
T Making decisions in advance is prudent
for oneself and a caring act for loved ones. It may be that the plans made now will not be needed, but it is better to have a plan ready and not need it than to need it and not have it. Do not delay thinking about possible disability “until you need to”. When you reach the point of needing help you may not be able to make appropriate plans.
Financial Decisions
If you do not make arrangements for the handling of your business while you are competent, and you later become incapacitated, court proceedings may be necessary to appoint someone to manage your affairs. Having a Conservator appointed can be intrusive and embarrassing. It can also be expensive, entailing court costs, attorney fees and costs of a bond. These expenses come from your estate. A Conservator must go to the court to ask for permission to spend money for you, and each court proceeding means additional expenses. If you have someone in whose integrity and good judgment you trust, this painful process can usually be avoided by executing a Durable
hanks to a great increase in life expectancy during the 20th century
Power of Attorney or a Living Trust, but you must do this while you are competent.
Durable Powers of Attorney The simplest and least expensive way to
plan for management of your business affairs is to execute a Durable Power of Attorney, appointing an agent or “attorney-in-fact” to act for you if you are unable to manage for yourself. To be durable, that is, to remain valid
even if the Principal (person who executed it) becomes incapacitated, the document must include these words, or words to the same effect: “For powers that are to be effective immediately: This power of attorney shall not be affected by the subsequent disability, incompetence or incapacity of the principal.” If the document is a springing power
(springs into effectiveness when and if the principal is incapacitated): This power shall become effective upon the incapacity, incompetence or disability of the principal.
Caution
Durable Powers of Attorney are wonderful documents when used appropriately, but their simplicity also makes them easy to misuse. It is critical to choose an agent (called an “attorney-in-fact”) who is impeccably honest, has good judgment, and will be sensitive to your preferences. These are not qualities about which you can make a quick judgment. Your agent should be someone you have known well for a long time and who manages his/her own business well. Your agent should consider your needs and wishes fi rst in managing your assets, if that time comes.
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