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Power of Attorney vs Conservatorship: How Do They Differ and Which is Better?

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There may come a time when you need to care for a loved one who no longer can handle their own personal needs or finances and having to take control of another’s personal affairs and health care options is a serious responsibility.

While both POA and conservatorships make it so you take charge of a person’s life when they need the help, they are not the same and both need to be understood so you can choose the correct choice. This article will go over each option to help you understand how each works.

What is a Power of Attorney?

A Power of Attorney (POA) is a legal instrument that allows a person (known as the Principal) to appoint another person/family member/spouse (known as the Agent or Attorney-in-fact) to make financial decisions for them. There are also Medical Powers of Attorney and Advanced Health Care Directives which appoints a trusted person as the Agent to oversee the Principal’s medical care and make healthcare decisions for them if unable to do so themselves. Power of Attorney can be as singular or as far-reaching and long-lasting as needed by the Agent depending on the documents that are signed.

Power of Attorneys can be modified to allow the Agent flexibility in their responsibilities to the Principal and the Principal can appoint another agent if they so choose. Also, they can be used to create contingencies for when the Principal reaches advanced age or become incapacitated.

There are many different types of Power of Attorney that an individual can execute depending on what the person (Principal) wishes to delegate to their appointed agent.

No matter which sort of Power of Attorney is used, they are there to allow individuals to plan for their future healthcare or financial needs carefully and thoughtfully. The most common types of POA are:

Types of POA

General Power of Attorney

A General Power of Attorney allows the Agent to manage all of the financial affairs until the principal becomes incapacitated or the document is revoked. The Agent may be granted with a variety of different responsibilities and powers to use on behalf of the Principal, such as:

  • Managing bank accounts
  • Selling property
  • Settling claims
  • Managing personal assets
  • Signing checks
  • Filing tax forms
  • Executing financial transactions
  • Operating business interests
  • Purchasing life insurance
  • Hiring professional assistance
  • Making gifts

Durable Power of Attorney

A Durable Power of Attorney, permits your appointed Agent to make legal and business decisions for the principal if they become disabled, incapacitated, or unable to handle their affairs. While nondurable powers are automatically terminated if the individual who made them loses mental capacity, Durable Power of Attorney will remain in effect until legally revoked or until the principal dies.

Special Power of Attorney

A Special Power of Attorney allows the principal to appoint an individual to manage a one-off deal or transaction. With a Special POA, your agent will only be able to only manage the specific transaction for a limited amount of time.

Medical Power of Attorney 

Medical POAs allows the appointed Agent to make healthcare decisions for them if they are incapacitated or unconscious. This allows their wishes regarding medical treatment to be respected even if they cannot give consent due to accident, injury, or illness.

What is a Conservatorship?

A Conservatorship is a legal status where a court/judge appoints a person to manage the financial and personal affairs of a minor or incapacitated/mentally unstable person. In order to initiate a conservatorship, a petition must be filed with the court and during court proceedings, the judge hears evidence as to why the other party believes the individual needs the conservatorship, which is mainly due to them being truly incapacitated unable to make decisions for themselves.

If the judge/court finds the person to be impaired, then the court can grant a general or limited Conservatorship based on the level of incapacitation. For example, if an individual can care for his or herself, but needs assistance with financial matters, this would call for a limited conservatorship.

Conservatorship Guidelines 

A person is deemed “incapacitated” when they are unable to manage property and business affairs because of:

  • Mental illness
  • Mental deficiency
  • Physical illness
  • Illnesses due to age
  • Drug addiction
  • Alcohol addiction
  • Confinement
  • Detention by foreign power
  • Disappearance

Who Can Serve as a Conservator?

The following people are prioritized to becoming the incapacitated individual’s conservator:

  • Conservator appointed in another jurisdiction
  • Person selected by incapacitated person
  • Person designated by incapacitated person’s power of attorney
  • Spouse
  • Adult child
  • Parent
  • Relative with whom ward has lived for the last six months
  • Nominee of person caring for incapacitated person
  • General Conservator or Sheriff

Power of Attorney vs Conservatorship: What’s the Difference?

When comparing the difference between power of attorney and conservatorship, keep in mind that a person creates a power of attorney before a person is incapacitated. In contrast, a conservatorship is formed after a person is no longer able to competently make critical financial decisions on his or her own. It is up to the individual situation as to which one is best for that party’s best interest.

Need to Set Up a POA or Conservatorship? We Can Help.

An experienced power of attorney/conservatorship lawyer can help you address legal matters that can affect you or a family member’s quality of life and health. You’ll need an expert to interpret complex Alabama laws and you’ll want the very best to help you plan for your loved ones.

At Brackin & Johnson, our expert attorneys can assist you with planning for long term care and ensuring that your medical and financial needs are met should the time come when you or your family member can no longer care for themselves.
If you’re searching for a skilled attorney specializing in conservatorship, estate planning, living wills, and power of attorney, get in touch with us today to schedule your free initial consultation.

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