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A gavel rests on top of a law book whose spine reads, "Guardianship." SmartAsset takes a closer look at the ins and outs of adult guardianship.

Caring for one’s own financial situation is a key part of one’s own independence. But there are some cases where a person needs help making legal and financial decisions. That’s where the concept of guardianship comes in. Guardianship is not simply based on age or acting as a chaperone or caretaker for someone before they turn 18. It’s often the case that adults who are older than 18 need legal and financial guardians as well. While reaching out to a financial advisor could be a long-term solution for getting expert financial advice, learning the ins and outs of adult guardianship is a useful first step.

Guardianship Definition and Need

Guardianship refers to getting the legal authority to make decisions for someone else. A court appoints this person, known as the “guardian.” The person whom the guardian oversees is called the “protected person” or sometimes the “ward.”

We normally think of guardianship as only applying to parents or guardians who make decisions for a child or children under the age of 18, because by law minors are incapable of making their own decisions.

It’s usually presumed that adults have the capacity to make decisions for themselves. But adult guardianship may be necessary when those who are ages 18 and older are unable to do so, such as if an adult is incapacitated. This means that the person is unable to take care of themselves – and can occur for a variety of reasons, including mental illness, mental deficiency, disease or mental incapacity. This can happen to anyone from a younger adult to someone who is significantly older and already nearing retirement.

Types of Guardianship

Here are three ways to approach adult guardianship depending on the ward’s needs:

  • Guardianship over a person. This means that the guardian is responsible for the well being and care of the protected person, and can make personal and medical decisions for the person. These include healthcare decisions, decisions about living situation and sometimes decisions regarding education and schooling.
  • Guardianship over an estate. This setup allows the guardian to make financial decisions for the ward’s full estate. Only guardian will be allowed to spend or sell any of the protected person’s assets, and only by court order.
  • Guardianship over a person and estate. This approach is a combination of the above. The guardian will be responsible for all personal, medical and financial decisions of the protected person.

It is important to remember that the guardian does not have complete control or absolute control over the protected person’s finances and/or assets. Court approval is always required. Even the ward’s money cannot be access without a court order.

How to Obtain Legal Guardianship

Image shows a judge using a gavel to signal a final decision made in a guardianship hearing in court. SmartAsset takes a closer look at the process of adult guardianship.

A professional financial advisor and/or legal advisor are the best people to consult when going through the process of obtaining a legal guardianship. It’s also important to remember that certain details and steps vary by state.

Generally speaking, however, the first step is to file a written petition with a court in order to request that a guardian (for a person, their property or both) be appointed. The would-be protected person must receive notice of the petition and has the right to contest the request. The court may also require a visitor to make an independent investigation to determine whether guardianship is the appropriate way forward, or whether the would-be protected person or ward needs to be examined by a medical or other qualified professional. Finally, there is a formal hearing before a court, during which the judge weighs all evidence and makes the appointment, rejects it or orders some other solution.

How Long Does Guardianship Last?

Most often, adult guardianship will last upon the death of the protected person. It’s very important to note that in some cases, the judge who appoints the guardian may not appoint someone that the ward already knows and trusts – the guardian may turn out to be an independent professional with whom the ward does not have any existing relationship. This is something to consider when thinking about whether to dive into estate planning sooner rather than later. Getting a head start might help you start to bring your affairs in order earlier, and give you time to consider some alternatives.

Alternatives to Guardianship

If you or a loved one is fortunate enough to still be able to make your own financial and health decisions now, there are some other options to consider that could help you avoid or limit the difficult decisions and lengthy process that surround adult guardianship:

Bottom Line

Image shows someone's hand preparing to sign the estate planning documents in front of them.

Having to give over all control of your personal and financial decisions to another person can be a frightening thought, but an important one to consider in advance as you look towards other, more immediate money goals. Adult guardianship can be an involved and lengthy process, but there are alternatives available if it’s not in your best financial interests.

Tips for Preparing a Long-Term Financial Plan

  • It’s never too late to start building an emergency fund – because even retirees need one. Use our free budget calculator and savings account reviews to help allocate and set one up for yourself.
  • Seek out professional financial advice. You wouldn’t run a marathon without a trainer, would you? So why not apply the same logic to your long-term money goals? Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Photo credit: ©iStock.com/AndreyPopov, ©iStock.com/Chris Ryan, ©iStock.com/JodiJacobson

Nadia Ahmad, CEPF® Nadia Ahmad is a Certified Educator in Personal Finance (CEPF®) and a member of the Society for Advancing Business Editing and Writing (SABEW). Her interest in taxes and grammar makes writing about personal finance a perfect fit! Nadia has spent ten years working as a seasonal income tax assistant, researching federal, state and local tax code and assisting in preparing tax returns. Nadia has a degree in English and American Literature from New York University and has served as an instructor/facilitator for a variety of writing workshops in the NYC area.
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