The first two building blocks of a good estate plan are the General Durable Power of Attorney, also referred to as a financial power of attorney, and the Durable Power of Attorney for Health Care. Every adult should have both. As an adult, you are the only one who can make decisions with regard to your own finances and health care. There are only two means by which someone else could obtain the authority to make those decisions for you. The first is through the use of the two powers of attorney. With these documents, you yourself appoint “agents,” one for your finances and one for your health care. These individuals then have the legal authority to act on your behalf in the event of your incapacity. Having both of these documents is just as important if you are married as it is if you are single. In the State of Wisconsin, although your spouse may retain access to many of your jointly titled assets, he or she does not have the legal right to make decisions for you, regardless how long you have been married.
The financial agent and the health care agent have completely separate roles. You can, however, appoint the same individual. The key is that you are the one choosing your agents. Moreover, the health care power of attorney allows you to provide a great deal of guidance to your agent. The document has a section in which you can detail your specific wishes regarding health care; for example, any religious preferences you may have, or your willingness to be an organ donor. Overall, the powers of attorney allow you to address the possibility of incapacity in an inexpensive but highly personalized manner.
If you become incapacitated but have not previously signed both powers of attorney, a legal proceeding called a guardianship becomes necessary. Under a guardianship, a Court would declare you to be incompetent and would remove your legal rights to handle your own health care and financial decisions. The Court would then turn those rights over to another person, known as the guardian, to exercise on your behalf. The person who handles your finances is known as the “guardian of the estate,” and the one who handles your personal and health care decisions is known as the “guardian of the person.” These are again separate roles that may be occupied by the same individual. Once appointed, the guardian of the person will have to file an annual report regarding your personal welfare and the guardian of the estate will have to file a detailed annual account of how your assets have been spent throughout the year. Once a guardianship has been put into place, it is almost always permanent. The only way to reverse a guardianship would be to prove to the Court’s satisfaction that your mental competence has been restored. A guardianship is a stressful, time-consuming and expensive legal proceeding which can generally be avoided if the proper powers of attorney are in place.Like this article? Please share it: