It can be devastating to watch an incapacitated family member or friend ruin their finances through a series of poor decisions. You know them well enough that, without the overpowering influence of mental illness, disease, or addiction, they could handle their money wisely. Getting them back on a stable financial path will require convincing them to sign a power of attorney or petition a judge for a conservatorship, the latter of which you loathe.

You might be researching the power of attorney option, for example, in hopes that a county court will not appoint a conservator to oversee your loved one. They can be a stranger who is not affiliated with your family and does not bear their best interests, that handles their financial matters. The conservator also may not share your family’s money management strategies, guiding your loved one in a direction you disapproved.

With your concerns in mind, we desire to educate you on the differences between a power of attorney and a conservatorship so you can avoid relinquishing control over your family or friend’s financial recovery. You must understand the nuances between each option to avoid a conservatorship at all costs since it is worth protecting your loved one’s legacy.

What is a Conservatorship?

A conservatorship is a legal action you can pursue through the local court (the county where the ward lives) when your loved one cannot take care of themselves or their finances. Guardianships, a similar solution, goes beyond incapacitated adults and help children whose parents have died, have left for an extended business trip, etc. When you break down the types of conservatorships, there are limited conservatorships for the person or the estate, categorizing the specific powers the county would give the conservator.

This could be due to various health and mental disabilities, such as alcoholism and autism, that lead them toward financial mishaps they would later regret. When you go through the legal system to appoint a conservator, they will classify your family member or friend as a partially or fully incapacitated person so that they can assist according to their individual needs. However, once the county court hands a conservator to your loved one, your family forfeits aiding them with their living arrangements, daily routines, and financial matters.

They will likely receive a stranger’s assistance with medical decisions and managing their bank accounts and investments, and the judge will silence your family’s opinions regarding their handling. Conservatorships are a final resort when helping your incapacitated family member wield their money wisely and could be necessary in some cases.

What is a Power of Attorney?

Similar to a conservatorship, a power of attorney is another viable legal option that assists your incapacitated loved one, with the exception that you retain full control. The ward can willingly sign away their financial management and personal care rights to you or another significant person in their life. When they realize their life’s downward trajectory and believe they cannot save themselves from crashing, they can appoint your family’s support in case they become incapacitated.

A durable power of attorney, a legal document your estate planning lawyer can help you pursue, allows your loved one to appoint someone specifically to direct their finances and help with paying bills. However, they can also obtain a durable power of attorney when dealing with healthcare decisions and endow a trusted person to act on their behalf.

You can manage their estates and assets, in this situation, to protect their family’s legacy and help them navigate short-term and long-term spending and investing. Nobody understands a person’s best interests better than those closest to them, promoting this legal course for their financial affairs above conservatorship.

If your family member or friend decides to sign a durable power of attorney document, they can stop a stranger from controlling their money and keep you from paying an exorbitant, hourly conservator service fee. You can commit your time and energy to their financial freedom and success without destroying your own, and ultimately helping them in a personal manner that a government-appointed worker could not.

When Do I Have to Get a Conservatorship vs. Power of Attorney?

While you may be dreading the thought of going through with a conservatorship, it may be necessary if your loved one has not already put a power of attorney in place and they meet certain conditions.

For example, Michael and Kelly knew that their son’s recent drug habit was plummeting his finances into the ground and his bank account would be the first thing to collide with solid asphalt. They could advise him to drive to the bank and collaboratively notarize a durable power of attorney document, giving them complete decision-making power over his finances. He would not have unrestricted, immediate access to his bank account and have the opportunity to catch his airborne bearings before crashing.

In contrast, if Jackson’s small-time drug pastime grew into a full-blown cocaine addiction, a durable power of attorney would be impossible unless he submitted his autonomy. Since the law would already consider him incapacitated at that point, Michael and Kelly would need to drive to the county courthouse and petition for a conservatorship. Then, they could halt his self-destructive spending using legal authority in their favor, although an unfamiliar conservator would step into his life.

When your family member or friend suffers from mental illness or health disabilities, and you question their ability to make wise financial decisions, both a power of attorney and conservatorship can help. We recommend making every effort to persuade them to establish a power of attorney, so you have access to their finances. However, if the situation has progressed far enough or events have rapidly unfolded, conservatorships can keep them from harming themselves and others with their poor financial problems.

We Can Answer Your Difficult Estate Questions

Your loved one’s specific circumstances are just as complicated and intricate as the differences between a power of attorney and a conservatorship. We understand there is no “one-size-fits-all” answer in terms of broad legal advice, and we would be honored to listen to your case. Then, we can answer any further questions about both legal solutions in our free initial consultation.

Please contact our office and begin your loved one’s journey to financial freedom today by calling (800).840.1998.