Alternatives to Conservatorships
Similar to guardianships, Arizona conservatorships are generally reserved for those who have not designated somebody to handle their financial affairs. Those who make plans in advance, however, can reduce the likelihood that they will require an AZ conservatorship at some later time. Legal tools are available that can serve as viable alternatives to conservatorships:
1. Durable financial power of attorney.
An individual (called a principal) can use a financial power of attorney to appoint an agent to handle his financial and legal affairs. There are certain guidelines for establishing a valid Arizona financial power of attorney:
- The principal must understand the nature and effect of signing the financial power of attorney.
- The principal must sign the financial power of attorney willingly.
- A notary and witness, other than the agent, the agent’s spouse or the agent’s children must sign the financial power of attorney.
- A financial power of attorney can be revoked or changed for as long as the principal has capacity.
To be valid, an Arizona financial power of attorney must meet certain requirements. Financial powers of attorney do not, however, have to be on any specific form. Free downloads of valid financial powers of attorney can be downloaded from JacksonWhite’s Elder Law website, at www.arizonaseniorlaw.com.
2. Living trusts
With living trusts, people can designate a trustee to manage trust assets according to their wishes. By designating somebody else as the trustee, people can ensure that trust assets are protected even if they lose capacity. Trustees are bound by fiduciary duties to use trust assets according to the terms of the trust, so those who plan ahead by establishing a trust can implement financial strategies that may remain in effect even beyond their lifetime. By the time an individual requires a guardian or conservator, however, establishing a trust is no longer an option, as capacity is also a requirement for establishing a trust. As such, just like with powers of attorney, the time to consider a trust is before health problems arise.