How Does Guardianship Work?

How does guardianship work? For the most part, we are free to make our own decisions regarding how we live, where we live, how we spend our money and even with whom we socialize. However, when we are no longer capable of caring for ourselves, most commonly due to advancing age or dementia, or if an accident or illness occurs and we can’t manage our affairs, it may be necessary to seek a guardianship, as explained in the recent article “Legal Corner: A guardian can be a helpful tool in cases of incapacity” from The Westerly Sun. A guardianship is also necessary for the care of a child or adult with special needs.

If no proper estate planning has been done and no one has been given power of attorney or health care power of attorney, a guardianship may be necessary. This is a legal relationship where one person, ideally a responsible, capable and caring person known as a guardian, is given the legal power to manage the needs of a ward, the person who cannot manage their own affairs. This is usually supported through a court process, requires a medical assessment and comes before the probate court for a hearing.

Once the guardian is qualified and appointed by the court, they have the authority to oversee everything about the ward’s life. They have power over the ward’s money and how it is spent, health care decisions, residential issues and even with whom the ward spends time. At its essence, a guardianship is akin to a parent-child relationship.

Guardianships can be tailored by the court to meet the specific needs of the ward in each case, with the guardian’s powers either limited or expanded, as needed and as appropriate.

The guardian must report to the court on a yearly basis about the ward’s health and health care and file an annual accounting of what has been done with the ward’s money and how much money remains. The court supervision is intended to protect the ward from mismanagement of their finances and ensure that the guardianship is still needed and maintained on an annual basis.

The relationship between the ward and the guardian is often a close one and can continue for many years. The guardianship ends upon the death of the ward, the resignation or removal of the guardian, or in cases of temporary illness or incapacity, when the ward recovers and is once again able to handle their own affairs and make health care decisions on their own.

If and when an elderly family member can no longer manage their own lives, guardianship is a way to step in and care for them, if no prior estate planning has been done. It is preferable for an estate plan to be created and for powers of attorney be created, but in its absence, this is an option.

Reference: The Westerly Sun (Sep. 19, 2020) “Legal Corner: A guardian can be a helpful tool in cases of incapacity”

Key Parts of Estate Plan

The importance of having key estate planning documents cannot be overstated. That includes a will, an advance directive, powers of attorney for health care and financial matters and guardianships for minor children. Trusts may also be part of an estate plan, and they need to be created and funded in a timely manner. However,, according to the article “7 Things Your Client’s Estate Plan Might Be Missing: Morningstar” from Think Advisor, there are a number of frequently overlooked estate planning documents that make a difference.

Financial Overview. This gives a broad outline of your assets and can be a useful discussion starting point, when one spouse manages the money and the other needs to be brought up to speed. It includes information about larger assets, including the home, investments, cars and other valuables.

A Directory. Creating a complete master list of all accounts, including the account number, website addresses and the names of any individuals that you deal with on a regular basis, avoids sending loved ones on a scavenger hunt. Keep this document safe—either encrypt it or keep it in a locked, fireproof safe in your home.

Personal Property. Wills contain directions about property, but not everything gets included. Make a list of any tangible personal property that you want to go to specific people, like jewelry or artwork, and create a detailed memo. It won’t be part of the will, but most states consider such memos legally binding, as long as they are mentioned in the will. Your estate planning attorney will know what is best for your situation and in your state.

Plan for Pets. The best way to do this is with a pet trust, which is enforceable. You name a person to take care of your pets, and how much money they should use to care for the pet. The will can be used to specify who should be your pet’s caretaker. You can leave assets for the pet, but the designated person is not legally bound to use the money for the pet’s well-being.

Digital Estate Plan. Make a plan for your digital property, including tangible digital devices, like computers and phones and the data stored on devices in the cloud and online accounts, including social media, websites, emails, photos, videos, etc. Start by making an inventory of all digital accounts, which needs to be stored in the same way your directory is: under lock and key.

End of Life Plan. Advance directives are estate planning documents that are used to direct your wishes towards life-extending care, but they don’t always go into detail. Providing additional information to loved ones who might need to make health care decisions could alleviate a lifetime of guilt. Having conversations is a starting point but putting your wishes into a document is better.

Ethical Will. An ethical will in which the person hands down their belief system to loved ones is a gift and part of your legacy. What would you want the next generation to know about your beliefs? What life lessons do you want to share?

Reference: Think Advisor (July 22, 2020) “7 Things Your Client’s Estate Plan Might Be Missing: Morningstar”

How Does My Estate Plan Change After Divorce?

Estate planning after a divorce involves adopting a different type of arithmetic. Without a spouse to anchor an estate plan, the trustees, guardians or health care proxies will have to be chosen from a wider pool of those that are connected to you. As with all significant life changes, a recent divorce requires immediate changes to your estate plan.

Wealth Advisor’s recent article entitled “How to Revise Your Estate Plan After Divorce” explains that beneficiary forms tied to an IRA, 401(k), 403(b) and life insurance are just some of the key documents that will need to change, reflecting the dissolution of the marriage.

It is important to note that there are usually estate planning terms that are included in agreements created during separation and divorce. These may call for the removal of both spouses from each other’s estate planning documents and retirement accounts. For example, in New York, bequests to an ex-spouse in a will prepared during the marriage are voided after the divorce. Even though the old will is still valid, a new will has the benefit of realigning the estate assets with the intended recipients.

However, any trust created while married is treated differently. Revocable trusts can be revoked, and the assets held by those trusts can be part of the divorce. Irrevocable trusts involving marital property are less likely to be dissolved, and after the death of the grantor, distributions may be made to an ex-spouse as directed by the trust.

A big task in the post-divorce estate planning process is changing beneficiaries. Ask for a change of beneficiary forms for all retirement accounts. Without a stipulation in the divorce decree ending their interest, an ex-spouse still listed as beneficiary of an IRA or life insurance policy may still receive the proceeds at your death.

Divorce presents changes to your children in terms of planning your estate. For one, divorce makes children assume responsibility at an earlier age. Adult children in their 20s or early 30s typically assume the place of the ex-spouse as fiduciaries and health care proxies, as well as agents under powers of attorney, executors and trustees. Further, if the divorcing parents have minor children, they must choose a guardian in their wills to care for the children, in the event that both parents pass away.

Ask an experienced estate planning attorney to help you with the issues that are involved in estate planning after a divorce.

Reference: Wealth Advisor (July 7, 2020) “How to Revise Your Estate Plan After Divorce”

What Can a Strong Estate Planning Attorney Help Me Accomplish?
Consult with our team to find out if the Law Office of Michael T. Huguelet, P.C. is the right fit for you.

What Can a Strong Estate Planning Attorney Help Me Accomplish?

No matter your age, the estate planning attorney you hire should have outstanding credentials and testimonials to their efficiency and personal concern. At the Law Office of Michael T. Huguelet, our promise to service your needs is backed by experience and expertise. Our team is equipped with the tools to make your estate planning goals become a reality.

As you begin settling down, it is sensical to start considering how you’ll provide for and protect those you love. It’s important that these responsibilities rest in good hands. Your estate planning attorney ought to have the knowledge and skill to help you design a workable, legally binding estate plan, one that’ll keep your assets safe as they accumulate, protect your loved ones, and consider the possibility that you may become incapacitated when you least expect it.

It’s only natural that you would be picky in choosing your estate planning attorney. This legal professional must be able to:

  • Listen, understand, and address your individual needs
  • Clarify your options
  • Draft, review, and file all necessary estate planning documents
  • Make certain your estate plan covers all contingencies; and
  • modify your documents as your life circumstances change.

The future is unpredictable. Estate planning can help you make that future as secure as possible.

Estate planning can be as complicated as it is essential. Accordingly, regardless of our age, speak with a highly competent estate planning attorney as soon as possible.

As the COVID-19 pandemic has dramatically shown us, planning for the unexpected can never be addressed too soon.

Reference: Legal Reader (June 23, 2020) “When Should I Start My Estate Planning?”

Why Do I Need a Will?

Estate planning is a very personal process. It is not a one-size-fits-all task. When a person has no close relatives (other than perhaps a spouse), the decisions needed to create an estate plan can be overwhelming. Kiplinger’s recent article, “No Children? Why You Still Need an Estate Plan,” provides some ideas, if you find yourself struggling:

Incapacity. Everyone should have an advanced directive for health care and a durable power of attorney for legal and financial decisions. These let you decide who will be in charge of your medical and legal affairs, in the event you are no longer able to make these decisions for yourself. If you become incapacitated without these documents, your relatives will be involved in a guardianship or conservatorship proceeding to appoint someone (who you may not know) to make these decisions for you.

Trusts. This is a legal document that can be used to manage many of your assets during your life, and facilitate the distribution of your assets when you pass away. A trust has two big advantages: it often helps avoid probate at your death and allows you to distribute your assets privately. Without at least a will, your family (as determined by the state intestacy laws) could inherit your assets. The best way to avoid these issues is to create a trust.

Deciding What to Do with Your Assets. This can be a tough decision.  Children often want to make sure that their parents are cared for. However, since many of us will survive our parents, successor beneficiaries must be named. Nieces and nephews are typically beneficiaries, when there are no children. However, you may want to consider friends, pets and charities. Talk to the estate planning attorneys at Michael T. Huguelet, P.C. to review the best way to leave your assets.

Charities. These can also be included in your estate plan. Charitable bequests can be either a specific bequest for a general or specific purpose. If the charitable gift is sizable, contact the charity beforehand to be certain your gift is used, and recognized, in the way that makes you most comfortable.

Pets. Your estate plan can also help establish who will take care of your pets, when you’re no longer here. You can leave the pet and some money to a trusted friend or family member, or you can create a formal pet trust to provide for your pet. Either way, create a plan so your pet can be properly cared for, if you are no longer able to do so.

When it comes to estate planning, you can decide who will inherit your assets. To be certain your wishes are executed as you intended, it is important to have the proper planning in place to avoid probate and allow for an efficient transfer. The attorneys at Michael T. Huguelet, P.C. would be happy to sit down with you, and assist with the decision making process so you have piece of mind that your assets are left to those who mean the most to you.

Reference: Kiplinger (February 11, 2019) “No Children? Why You Still Need an Estate Plan”