When individuals cannot manage their finances, courts can appoint guardians. Financial guardianship is for those who need help handling money. This may be an appointment on its own or an appointment with other guardianship powers.
Depending on the jurisdiction, financial guardianship may also be called guardianship of the estate or conservatorship.
In cases where individuals need help with personal and financial decisions, the court can order guardianship of the person and estate.
What Financial Guardianship Entails
Financial guardianship gives the guardian the authority to oversee the protected person’s finances and access money to pay bills. In many cases, the terms of the arrangement require the guardian to seek court approval before making financial actions on behalf of the ward, such as selling assets.
The person under guardianship’s money goes into a blocked account that only the legal guardian can access.
When Do Courts Order Financial Guardianship of an Adult?
Someone will need to petition the Court to start the process of guardianship. Courts appoint financial guardians when people demonstrate that they cannot handle their finances on their own.
- Individuals who frequently forget to pay bills might need help with finances. For instance, a person might need help remembering to pay bills and handling money.
- Those who are vulnerable to financial exploitation might also need guardians. For example, suppose a person makes significant payments to an online scammer. In that case, a loved one might petition the court to become the person’s guardian to protect them.
- Individuals with diseases and disabilities that prevent them from understanding money may also need the help of a trusted person. For instance, dementia can cause people to have executive functioning difficulties that impact their ability to handle money.
When a person has significant assets but needs help managing them, courts will order financial guardianship. Individuals with limited income and assets might not need financial guardians.
Alternatives to Financial Guardianship
While providing protection and support, guardianship limits autonomy. Many states require courts to explore less restrictive alternatives to guardianship before appointing a guardian. Those facing challenges with financial decisions should, along with their loved ones, first consider other options such as a power of attorney or a healthcare directive. These documents require that the individual have enough understanding of the meaning of these documents in order to execute them.
Our office handles many guardianship matters. Contact us today to get started.