We get a lot of calls from people who think they need to get a guardianship over their loved one for a variety of reasons spanning from financial irresponsibility to possible self-harm to elder abuse. Deciding between a guardianship or a general durable power of attorney (GDPOA) can seem like a tough choice. When faced with this decision, it helps to better understand the differences between the two.
A guardianship is considered more restrictive than a GDPOA–not just more restrictive for the proposed ward, but for the guardian as well. The probate court prefers the least-restrictive legal arrangement for an individual, so, in order to be appointed guardian, one needs to obtain a physician’s statement regarding the proposed ward stating that a guardianship is necessary. In addition, guardians will need to complete guardian classes, and if serving as guardian over the ward’s finances (aka guardian of the estate), the guardian will need to be bonded, which requires the guardian to pass a credit check.
Guardians have annual reporting requirements to the probate court. Guardians of the estate also have to request approval from the court to spend the ward’s money. These reports and requests become public records, so privacy is lost in a guardianship.
Guardianships can be contested, even by the proposed ward, and they tend to get expensive due to court costs, filing charges, and attorney fees. With a GDPOA, you have the opportunity to select the person who you want to be in charge of your affairs rather than having the court decide for you. A GDPOA is also very inexpensive to prepare compared to the thousands of dollars required to set up and continually maintain a guardianship.
It is important to get a complete estate plan prepared, which includes the preparation of a GDPOA. You can save time, money, and stress, and the relationship will stay private, by planning in advance for a situation that may require another person to step in and make medical and financial decisions for you by having a GDPOA prepared.