Every day we make hundreds of decisions for ourselves—from what to eat for breakfast to how to manage our finances. However, what happens if you cannot make decisions for yourself? Who do you want making day-to-day decisions on your behalf and serving as your guardian?

Financial Power of Attorney

If you have recently created or reviewed your estate plan, you probably discussed and signed a financial power of attorney. For those of you on the fence about completing your estate plan, this important tool allows you to authorize an individual of your choice to manage your financial affairs (for example, sign checks in your name, open a bank account, manage your real property, enter into contracts on your behalf, etc.). This can be very beneficial if you are no longer able to do these things for yourself; someone else can legally step in and handle these tasks for you immediately.

However, you may run into situations in which third parties (such as your bank) will require the nominated individual to have explicit authority to complete tasks or manage your financial affairs in a way that is not provided through a signed financial power of attorney. In these cases, if you no longer have capacity, your loved ones may need to go before a judge and have them appoint a Guardian, known in Texas a Guardian of the Estate, for your benefit. This is why you should not only appoint an agent in your financial power of attorney but also nominate a guardian for yourself in case the need for one arises (if permitted in your state). This can often be accomplished through documents which clearly state the person(s) you want to act on your behalf, if you are unable to do so.

What is a Guardian?

A guardian is essentially a court-appointed and court-controlled agent. In Texas, a guardian may be appointed for making day-to-day decisions, and are known as the Guardian of the Person. Or the court may appoint someone to manage your finances, and they are known as the Guardian of the Estate. In many jurisdictions, if a guardianship (sometimes known in other states as a conservatorship) is required, the court will give priority to an individual who has been named as an agent or desired guardian either under a financial power of attorney or pre-designation of Guardian document, making it incredibly important that you have these documents prepared.

If you do not have one of these tools in place, each state has a law that defines the order of priority in which people are appointed to serve in this role. In some cases, you could end up having someone handling your affairs whom you would have never wanted, like an estranged parent or sibling.

To ensure that you are taken care of by someone you trust when you can no longer take care of yourself in the way you desire, it is important that you choose the right person. When analyzing the pool of candidates, consider the following questions:

• Do they have the time to act as your guardian? Often, the most organized and knowledgeable individuals are also the most heavily scheduled and may not be able to step in easily.
• Do they live close by? Even in our digital world, some issues may take multiple steps or require in-person interactions to resolve. If the individual you are considering appointing lives far away, they may not be able to carry out their duties fully without unnecessary time and expense.
• Do they have the necessary skill set? When acting as a conservator, it is crucial that the individual you select is organized, thorough, and able to communicate clearly. A person who is scattered or is unreliable is unlikely to be a good advocate for you.

While we all want to retain as much autonomy as possible, there may come a time when we need someone to act on our behalf. Selecting the right individual to act as your advocate and ensure that you are taken care of according to your wishes is especially important. If you have any questions or would like to discuss whom you should appoint for this role, please contact us. Nielsen Law PLLC provides family-focused estate and business planning to individuals and families in Austin, Round Rock, Cedar Park, and the Central Texas area. We look forward to working with you.