Over the coming decades, adults age 65 or older are expected to account for a quarter of the U.S. population. Millions of them will likely suffer from Alzheimer’s disease and related dementia. Many already are fighting this battle.
This reality will force many younger Americans to answer a difficult question: How can I make sure an aging loved one with dementia continues to receive proper care? There are two common options people turn to, conservatorship and power of attorney. While both ultimately grant you the legal responsibility to care for an incapacitated loved one’s financial affairs, these solutions come with significant differences.
Early planning with power of attorney
A power of attorney is a legal document. It allows an individual, before they are incapacitated, to designate an agent. This agent will be granted the ability to take care of certain financial affairs on behalf of the individual (known as the principal).
Oftentimes, a power of attorney is written so that the agent only takes over these responsibilities when the principal becomes incapacitated and can no longer do so themselves. In addition, establishing a power of attorney is a fairly simple process, one that is often quick and does not require much court involvement.
This makes it a valuable tool for families that want to plan ahead. However, this isn’t always realistic. A power of attorney can only be created and signed when the principal has the full mental capacity to understand the effects of their decision.
So what happens if you need to provide financial oversight after a loved one is already incapacitated?
Adjusting to the new normal with a conservatorship
Conservatorship is a step you take only after a loved one becomes incapacitated and requires assistance with financial matters. When an individual is appointed a conservator of the estate, they will take on many of the same monetary responsibilities as an agent might.
Establishing conservatorship is much more complex, however, because it requires navigating a strict court process. It involves:
- Completing and filing a petition with the courts
- Informing relevant parties, including the conservatee
- Complying with a court investigator
- Attending a hearing
A judge will only grant the conservatorship if it is the only way to meet the conservatee’s needs. Unlike with a power of attorney, the conservatorship process requires strict court oversight at each step. It can take longer and will likely require additional ongoing involvement on your part.
Both a power of attorney and a conservatorship can help you feel confident an aging loved one has sufficient support. Understanding the scope of each of these tools, as well as the legal requirements, will go a long way toward helping you select the right path forward.
