As people age, their mental capacity often declines. It's hard to see a family member struggling with basic tasks, but it can be equally hard to know what to do about it. This guide explains your legal options and offers suggestions for reaching out for support.
Power of attorney is your best financial defense
A durable financial power of attorney appoints someone to handle financial and legal transactions for you if you're not able to take care of them yourself. Durable powers of attorney can be structured to be effective immediately or only if you become incapacitated.
Powers of attorney are often signed along with other estate planning documents. For example, when a person with a power of attorney becomes incapacitated, the agent named in the document (also known as the “attorney in fact") steps in and can do anything that the document allows, such as handling financial transactions and signing contracts.
A power of attorney is the smoothest way for a family member to take over when a relative can't manage his or her own affairs anymore. To get started:
- Find out if your relative already has a power of attorney. It's common to sign powers of attorney along with a will, and to keep the documents together. Try looking for your relative's will and you may find a power of attorney too.
- If you can't find a power of attorney, your relative may be willing to sign one now, provided they still have the mental capacity to do so.
- If your relative's mental state has deteriorated too far or they refuse to sign a power of attorney, you may have to go to court and seek a guardianship or conservatorship.
Mental capacity and powers of attorney
To be mentally capable of signing a power of attorney, you must be able to understand the nature and quality of the transaction, along with its significance and consequences.
If a power of attorney is prepared by a lawyer, the lawyer will ask questions and assess your relative's capacity to sign the document. If someone later contests the document's validity, the lawyer can testify about its signing and the person's mental capacity.
Guardianships and conservatorships
If a power of attorney isn't an option, the alternative is to go to court and seek to have your relative declared mentally incompetent. This involves an evaluation by a physician or other expert and a hearing. The court will appoint someone, who may be called a guardian or a conservator depending on your state, to handle your relative's affairs.
The public court proceeding can be expensive and difficult emotionally for the relative you're trying to help and your family. Unless your relative nominated someone to serve as guardian or conservator when he or she had capacity, they do not get to choose who will handle their affairs.
Finding help with housing and caregiving
- Financial and health care powers of attorney only extend to the matters specified in the written documents. That typically doesn't include forcing a family member to move from their residence to an assisted living or another facility, which usually requires a conservator or guardian.
- To avoid a court proceeding or a crisis, be proactive in encouraging your elderly relative to consider other living arrangements, and realize that convincing them may be a long process.
- If your loved one is in the hospital or a rehabilitation facility, meet with their social worker, who can help develop a care plan and connect you to community resources. You can also find help and resources at eldercare.gov.
- If there are hygiene and safety issues, your local social services office can perform an assessment and recommend appropriate resources.
A financial power of attorney makes it easier for family members to take over a relative's financial and legal affairs, if that becomes necessary. Unfortunately it won't take care of everything, so it's also important to get support elsewhere.
Find out more about Estate Planning Basics