When most people think of estate planning, they think of transferring their life savings to their heirs at their death. Their goal is to leave a legacy for those they love. They are not thinking about what would happen if they were in a serious accident and were no longer able to make decisions independently.
The majority of Americans today do not have an estate plan. The absence of completing an estate plan, however, does not mean you do not have a plan. Should you pass away, New York State has rules and regulations that will dictate how your assets will be distributed under the probate code. Similarly, in the absence of an estate plan to care for you during your lifetime, such as a durable power of attorney, in the event of a sudden crisis that renders you incapacitated, the court has a process for determining the appropriate to decision maker for you. This process is called guardianship.
The guardianship process was created to handle instances where a person did not name a decision maker through advance directives prior to incapacity. When you no longer have capacity the court can be petitioned to step in and determine the right decision maker for you going forward. There can be numerous challenges when you go through the guardianship process, not the least of which is determining you are, in fact, incapacitated. Let us share the issues we have observed in our practice with you.
1. The expensive cost of guardianship.
Guardianship is an expensive process. Similar to probate, there are court costs and attorney’s fees. More so than probate, however, there are also medical examiner’s bills and the cost of a second attorney who will represent the potentially incapacitated person. Guardianship can easily cost you and your family thousands of dollars and this is just the starting cost. Every year that a person is under guardianship, there will be additional costs with filing annual plans.
2. The length of time involved.
In most instances, your family is looking for an immediate solution when the need for guardianship arises. Unfortunately this process, as with many court-based processes, takes time. Even though there may be emergency proceedings available, this will not be a quick process. Guardianship ultimately can take months to reach an initial determination and will not end with that determination. There will be accountings and annual filings required every year the person is a ward under guardianship.
3. The inability to plan for long-term care.
None of us want to think of a time when we will have to spend tens of thousands of dollars paying for skilled nursing facility care. If you do not plan ahead, however, with your estate planning and name an agent under your durable power of attorney this may be the reality you are facing. Most of the solutions available to pay for long-term care will not be authorized by the guardianship court. Families in this situation find themselves forced to spend all of the income and assets of the incapacitated person on long-term care.
These are just a few of the reasons why the guardianship process may be something you want to avoid. Do not wait to begin your estate plan and do not allow the guardianship process to be the only alternative left for your family. Contact our firm for more information on this important matter.
