By: Barry E. Haimo, Esq.
October 10, 2019
Guardianship vs Power of Attorney
One of the most common questions estate planning attorneys receive from clients is, “What’s the difference between an appointed guardianship and a designated power of attorney?”
The essential differences are when the appointment happens, and who selects the person responsible for making decisions on your behalf.
You are the one who designates powers of attorney, and you can do it at any point you wish. In contrast, guardianship is often initiated by family members or close friends on behalf of a loved one. To begin the process, they must file a petition with the local county court.
Let’s look at each one in more detail.
Designating Powers of Attorney
A power of attorney is a legal document outlining the authorization of one person (an agent) to act on another person’s (the principal’s) behalf.
There are several different types of powers of attorney (POA) that clients can establish depending on which decisions they would like certain people to make for them, and under what circumstances.
Types of Decisions You Want Your Agent to Make
A financial power of attorney allows your agent of choice to manage money-related matters. A health care power of attorney, on the other hand, enables its appointee (or health care surrogate) to make health care decisions.
Scope of Decision-Making Power
While a General Power of Attorney offers up broad-scope decision-making responsibility, you can limit your agent’s authority as you see fit through a Limited Power of Attorney. You may be as specific as you’d like regarding what those decisions are and who should make them.
Deciding when you want your agent(s) to step in makes a difference, too. An agent can make decisions for you immediately and indefinitely through a Durable Power of Attorney. There’s also a regular Power of Attorney (not durable). The difference is that a durable power of attorney remains effective following incapacity. You may desire for someone to act on your behalf for a particular thing, and do not wish for it to continue indefinitely. You may want a non-durable power of attorney or limited power of attorney. Alternatively, if you’d rather wait until you become incompetent or incapacitated, a “Springing Power of Attorney” may be a more appropriate choice. (Note, regrettably, Florida no longer permits Springing Powers of Attorney).
When discussing guardianship vs power of attorney, this relationship is often described as a guardianship. A guardianship is ultimately appointed by a probate court, and guardianship is generally classified as one of two types: “guardianship of a person” and “guardianship of the estate.”
Guardianship of a Person
When a probate court grants authorization of one person (the guardianship) to make personal decisions on behalf of another person (the ward), it’s known as the guardianship of a person.
In order for this type of guardianship to be established, a licensed physician must submit documentation of a medical exam. It is only granted when the court finds the individual unable to meet essential requirements for self-care and safety.
The assigned guardianship then assumes the same duties, powers, and rights they would have over their minor children. They are required to report to the court regularly.
Guardianship of an Estate
The guardianship of a person is to a health care power of attorney as the guardianship of an estate is to a financial power of attorney. When the court decides an individual no longer has the capacity to manage his or her own finances, the appointee is assigned to make financial decisions for them.
The process of assigning guardianship of an estate is essentially the same as granting guardianship of a person, and quite often, the judge appoints the same person to both roles during the same court proceedings.
Answering questions of guardianship vs power of attorney, our philosophy at Haimo Law is that planning ahead is always the better option. This gives you the ability to choose who you think will best make decisions for you when you can’t.
If you haven’t thought about who you might consider, the time is now. If you have decided, but haven’t finalized your power of attorney paperwork, reach out. We are here to help!
Barry E. Haimo, Esq.
Strategic Planning With Purpose®
YOU ARE NOT OUR CLIENT UNLESS WE EXECUTE A WRITTEN AGREEMENT TO THAT EFFECT. MOREOVER, THE INFORMATION CONTAINED HEREIN IS INTENDED FOR INFORMATIONAL PURPOSES ONLY. EACH SITUATION IS HIGHLY FACT SPECIFIC AND EXCEPTIONS OFTEN EXIST TO GENERAL RULES. DO NOT RELY ON THIS INFORMATION, AS A CONSULTATION TO UNDERSTAND THE FACTS AND THE CLIENT’S NEEDS AND GOALS IS NECESSARY. ULTIMATELY WE MUST BE RETAINED TO PROVIDE LEGAL ADVICE AND REPRESENTATION. THIS INFORMATION IS PROVIDED AS A COURTESY AND, ACCORDINGLY, DOES NOT CONSTITUTE LEGAL ADVICE.