On Behalf of My Parent, Should I Act as Guardian or Attorney-In-Fact?

If your aging parent becomes incapacitated and needs someone to make decisions on his/her behalf, including decisions regarding medical treatments, financial issues, or living arrangements, you have a choice between serving as an attorney-in-fact (agent) if your parent has executed a valid Durable Power of Attorney (POA) appointing you as such, or pursuing a guardianship.

Often a Durable Power of Attorney is signed in hopes that it will prevent the need for future guardianship. But on occasion, even with a Durable Power of Attorney in place, a guardianship is needed.  Here are some things to keep in mind when considering your options.

First, it is important to understand that signing a power of attorney does not take away any rights the principal has to continue to act for him/herself.  A power of attorney does not insure that the person will not make poor financial decisions, enter into risky financial contracts or neglect their health care.

Another consideration with power of attorney is that the principal can revoke it at any time unless he/she has been adjudicated to be incapacitated by a court of competent jurisdiction.

A third consideration is that an agent under a power of attorney acts completely independently without any court oversight or involvement. This allows more flexibility for the agent.  Finally, there is no ongoing expense when operating under a durable power of attorney.

Guardianships differ from powers of attorney in all of the above aspects.  Once a person is adjudicated as incapacitated, their rights to handle their own personal and financial decisions can be removed.

The incapacitated person has no power to remove a guardian and again be able to handle their own affairs unless their condition improves and the court enters an order that they have regained capacity.

A guardian does not act independently, but instead, acts under the supervision of the court. Annual reports must be filed by the guardian for the remainder of the incapacitated person’s life for the court’s review and approval.

Last, but certainly not least, is the ongoing expense of guardianships. Court costs, attorney fees, and guardian fees can be significant over the course of the guardianship.

A POA may grant authority over two areas – financial issues and health care. Similarly, a guardian can be granted authority of the person and property. Although a POA and a guardianship share the same intended goal, they operate much differently and it is recommended to consult with an attorney to explore the differences.

This is not a decision to make lightly. Contact our elder law attorneys for an appointment to answer your questions and learn more about the differences in these two approaches.