1. Guardianship and Financial Planning
Date
Guardianship and Financial Planning
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2. Guardianship

3. Important Disclosures
The information provided is not written or intended as tax or legal advice. MassMutual, its subsidiaries, its employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel.
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4. Some Laws Vary By States
A matter of state laws, regulations and practice
The advice you receive should be state specific
Seek local legal counsel to get the state specific information you’ll need
First of all, the rules of guardianship vary by state.
It’s a matter of state laws, regulations and practice.
For those reasons alone, we suggest that you seek local legal counsel to get the state specific information you’ll need.

5. Why is Guardianship Needed?
Certain individuals, because of age or incapacity, are not legally able to handle their own affairs
In response to this problem, the law allows guardianship to be established by the courts
That said, let’s spend a few moments to cover just some of the generic basics, for example…Why guardianship is even needed.
Certain individuals, because of age or incapacity, are not legally able to handle their own affairs.
In response to this problem, the law allows guardianships to be established by the courts.

6. Some Laws
Until child is 18 years old, the parent is legally responsible for their welfare
Child is considered to be an adult at age 18, or (in some states) considered an adult if married before the age of 18
If the child is not able to make decisions in their own best interest, appointing a guardian is necessary
* Laws regarding guardianship can vary from state to state. For that reason, you’ll want to check with local legal council to determine if any variations exist from this generic information
Let me preface this slide by telling you that the laws regarding guardianship can vary from state to state. For that reason, you’ll want to check with local legal council to determine if any variations exist from this generic information.
First of all, in many states until a child is 18 years old, the parent is legally responsible for their welfare.
The child is considered to be an adult at age 18 (again, in some states), or considered an adult if married before the age of 18.
If the child is not able to make decisions in their own best interest, appointing a guardian is necessary.

7. Guardian vs. Conservator
About Guardianship…
Upon petition by an interested person, a court may appoint a qualified individual or institution to handle the affairs of an incapacitated individual
An individual for whom a guardianship is requested is referred to as the “protected person”
Guardian vs. Conservator
Guardian - Responsible for the person and/or their property
Conservator - Responsible only for the management of the person’s property
Can be the same person or entity
An obvious question at this point might be… How do you appoint or establish guardianship ?
If you had no one in particular that you would like to serve as the guardian of your special needs dependent upon your death, an interested person, such as yourself, would file a petition with a court. The court would then appoint a qualified individual or institution to handle the affairs of the incapacitated individual.

8. Physician’s certification is required
Appointing a Guardian
Requires proof to the court that the person is not able to care for him/herself, or able to look after his/her own affairs
Physician’s certification is required
In some states, one or more state agencies may be involved
All “interested parties” must be notified
Court appoints someone to represent the individual during the court proceeding
Called a “guardian ad litem” (GAL), they validate that the appointment is in the best interest of the individual
Guardian’s powers in dealing with the person’s property are carefully restricted by law
As far as actually appointing a guardian…
The court requires proof that the person is not able to care for him/herself or able to look after his/her own affairs.
A physician’s certification is required.
In some states, one or more state agencies may be involved.
All “interested parties” must be notified.
During the court proceeding to determine the appointment of a guardian, the court will appoint someone to represent the individual.
Called a “guardian ad litem” (GAL), they validate that the appointment is in the best interest of the individual.
The guardian’s powers in dealing with the person’s property are carefully restricted by law.

9. Types of Guardianship Regular Guardian Limited Guardian
Temporary Guardian
There are three types of guardianship that can be established.
Regular
Cares for and maintain the protected person
Sees that the protected person is property trained and educated and has the opportunity to learn a trade, occupation or profession
Reports the condition of the protected person to the court at regular intervals
Files income tax returns, pay taxes and file an accounting with the court every two years
Limited - The court may limit the authority of the guardian to act in only those situations where a guardian is necessary, thereby reserving to the protected person many of their rights and privileges
Temporary
In emergency situations, the court can appoint a temporary guardian for a specified person
This is an extraordinary procedure and is limited to emergency situations

10. Liability, Removal, and Termination of the Guardian
The guardian may be liable for any breaches of the duties which he owes to the protected person
The guardian may be removed by the court if they are not properly performing their duties, and a successor guardian will be appointed
If the guardianship was established when the protected person was under age 18*, or it generally terminates when the protected person reaches 18 years of age, or if married before age 18, or:
The protected person is no longer incapacitated, dies, or residence is changed to another state and a guardian has been appointed in that state
In the case of a guardian of the property, the estate is exhausted or the estate is less than some statutory minimum
If the court determines that the guardianship is no longer necessary for any other reason
On termination, the guardian is required to file an account and report of all activities
If the court accepts, the guardian will be discharged from all obligations
*Subject to state specific rules
Now that a guardian has been appointed, what is their liability ?
The guardian may be liable for any breaches of the duties which he/she owes to the protected person.
If for any reason you desire a guardian be removed from his/her responsibilities, what’s involved ?
The guardian may be removed by the court if they are not properly performing their duties.
A successor guardian will be appointed.
A successor guardian may also be appointed if the first guardian resigns or dies.
Next, let’s see what’s involved in the Termination of Guardianship.
If the guardianship was established when the protected person was under age 18 (in many states), it generally terminates when the protected person reaches 18 years of age or if married before age 18. Keep in mind that this rule is state specific and thus varies. So, you’ll want to check with local legal council for any variations.
Guardianship can also be terminated if the protected person is no longer incapacitated.
It also automatically terminates when the protected person dies.
In the case of a guardian of the property, the termination occurs when the estate is exhausted or the estate is less than some statutory minimum.
It also terminates if the protected person’s residence is changed to another state and a guardian has been appointed in that state.

11. Alternatives to Guardianship
Representative Payee
Specific Powers of Attorney
Health Care Representative
Durable Power of Attorney
Trust
Protective Proceedings
Parental Powers - Parents must be appointed guardians where significant amounts are involved
Is it mandatory to have a guardian appointed ? NO! There are alternatives to guardianship. They could be:
Having a Representative Payee,
A Representative Payee is a person authorized by the Social Security office to receive and manage federal funds for a person who is unable to mange their own funds.
The only source of income can be from SSI or Social Security.
Separate records must be maintained and the representative payee must not mix those funds with his/her own.
Periodic accounting is required to the Social Security office.
Establishing Specific Powers of Attorney
The Specific Powers of Attorney is a legal document drawn-up and designed to manage a specific asset: usually an account or deposit of a bank or similar institution.
While competent, the owner of the asset may use forms provided by the institution.
The Specific Powers of Attorney document is preferable to a joint account which creates ownership interest for the individual being asked to manage the account.
Appointing a Health Care Representative
A Health Care Representative is a person appointed by an individual who feels that they lack the ability to make decision regarding their health care.
The appointment of a Health Care Representative must be made when the individual is competent.
Obviously then, if an individual is not competent at the outset, appointing a Health Care Representative may not be a viable option.
Establishing a Durable Power of Attorney
With a Durable Power of Attorney, an individual gives someone else the power to make decisions for them.
This may include the power to receive federal checks, handle bank accounts, buy and sell real estate and make health care decisions.
The Durable Power of Attorney remains in effect during incompetency or disability (“durable”).
It ends when the power is revoked or the disabled individual dies.
Creating a Trust
A Trust is an agreement with a trustee transferring management of certain assets to a trustee.
The Trustee is required to manage the assets according to the desires of the individual as expressed in the trust document.
Initiating Protective Proceedings, and
In Protective Proceedings, the court, on request and without the appointment of a guardian, may issue a “protective order” for a minor or incapacitated person protecting the person or the person’s business affairs and property.
Included is the right to establish a trust for the protected person
Exercising Parental Powers
In the exercise of Parental Powers, the parents of a minor (jointly or as survivor) may execute on behalf o the minor, consents, waivers, or powers of attorney under the Internal Revenue Code and according to specific state tax, probate and health care law.
This alternate to guardianship, as with those preceding it, may have rules and regulations that are state specific and should therefore be discussed with local legal counsel.
"Included is the right to establish a trust for the protected person"

12. 10 Basic Financial Steps

13. Find quality professionals to assist you
Things to Keep In Mind
Find quality professionals to assist you
Remember that YOU are the expert about your dependent
Think “lifetime care” and “quality of life”
In summary
We can help you find quality professionals to assist you and your family
When it comes to your dependent we understand that YOU are the expert.
It’s important to think about lifetime care but critical to think about QUALITY of LIFE.

14. Step 2: Review beneficiary designations with family and close friends
10 Basic Steps
Step 1: Plan for the future needs of your dependent
Step 2: Review beneficiary designations with family and close friends
Step 3: Have a Family Meeting to Discuss Future Needs
Step 4: Create a team
1. Plan for future medical, educational and housing needs for your dependent.
Start by thinking about what your dependent’s needs will be in the future – and develop your financial strategy based on these projections.
Will they need weekly/daily medical treatments?
Will they need funds for college?
Would they live in a group home or need their own space?
2. To continue to receive federal aid, dependents with special needs cannot have any assets in their name (cash, art, jewelry) that is worth more than $2,000.
Check with close friends and family to see if they have designated your dependent to receive any inheritance or insurance benefits from their estate–
If they have, it’s important that they leave this amount to your dependent’s special needs trust.
Don’t let well-intentioned friends and family unknowingly cause your dependent to lose access to valuable resources.
Also don’t forget to check your own beneficiary designations
3. Have a family meeting to discuss your dependent's future needs.
Just as caring for a dependent with special needs is a family affair, so is the related planning.
With the thoughts that you have facilitated your dependent’s special needs throughout their life, meet with your family members to discuss their concerns and options for future care.
This is also a good time to broach the beneficiary designation issue discussed above.
4. As a special needs financial professional, we can help you with your planning and help you create a team of professionals that specialize in special needs planning.
Once you have determined the current and future financial needs of your dependent with special needs, it’s important to pull together a support team that can help guide you through the variety of options available to you and your family. The composition of the team may vary depending on your unique situation, but it should include an attorney, and perhaps a health professional and a school guidance counselor, among others.
5. Contact local nonprofit organizations for additional resource support.
Your local nonprofit may be able to provide resources that can help with planning or that supplement the standard services provided by government agencies. A good starting place is to first contact a nonprofit dedicated to your dependent’s special need.
Step 5: Get Additional Resource Support

15. Step 7: Prepare a Last Will and Testament
10 Basic Steps – cont’d.
Step 6: Learn about Government Benefits1
Step 7: Prepare a Last Will and Testament
Step 8: Understand a Special Needs Trust
Step 9: Guardianship / Conservatorship
6. Apply for government benefits.
Government benefits – such as Medicaid and SSI ( – may help provide for your dependent’s needs in the form of medical treatments and supplies, equipment, financial assistance and more. Visit your local Social Security Office to find out what benefits your dependent may qualify for; call or visit their website first to find out what documents you should have with you for your visit.
7. Raise your hand if you have a Last Will and Testament. Even if you think you do not have one, you do. The courts will decide for you if you do not prepare one yourself.
Prepare your Last Will and Testament (review and update periodically).
A Will declares how you want your estate to be distributed and allows you to select a guardian for your dependent when you pass away.
It may be especially important to prevent automatic asset distributions directly to a person with special needs, and to be cognizant to not leave your dependent with special needs any assets in excess of $2,000
Speak to your attorney for additional information.
8. This allows caregivers a way to provide for their dependent’s care and quality of life, without disqualifying them for federal assistance.
Trusts can be set up either funded or unfunded, and must be overseen by a trustee – often the dependent’s caregiver and/or a bank trust officer.
Funds can be contributed gradually over the years, or the trust can be designated as a beneficiary of an inheritance or life insurance policy.
The money in the trust must be used to enhance the dependent with special needs quality of life, and can help to supplement (NOT ‘Supplant’) standard services and benefits provided by government agencies.
Can provide for special medical equipment, eyeglasses, and even a trip to Disney with one caregiver. Assets can not be given directly to the beneficiary. Assets must be paid to a third party provider for the benefit of the person with special needs.
ALL family members must be made aware of the special needs trust once it is drafted. Gifts, well intentioned relatives, etc…
Make certain that the attorney you use to draft the SNT has real expertise in special needs planning. I can provide you with a list of qualified attorney’s if needed.
9. Caregivers must apply for a guardianship or conservatorship to maintain legal control over financial and healthcare decisions once a dependent reaches the age of 18.
This can take up to a year in some states, so it’s maybe best to start this process early.
There are different levels of guardianship and conservatorship available, depending on the dependent’s capabilities and needs. For example, a limited guardianship could be solely for financial or healthcare-related decisions.
Guardianship Issues:
In most states the law presumes that people over the age of 18 are competent, meaning they are able to make their own decisions about what is best for them in their daily lives.
Guardianship is a very personal issue; each family will have their own feelings regarding this topic.
Guardianship needs to be appointed and approved by the probate court, rules vary state to state.
It may be a good idea to have successor guardians appointed at the same time as the primary guardians.
Guardianship is not an all or nothing situation.
Limited guardianship provides limited power over property or a specific subject matter.
Other options are available such as Advocates or Representative payees. For example representative payees receive monies on behalf of a disabled person. Again this is a very personal issue and every family has to make their own decision based upon their situation.
10. One answer, is the Letter of Intent
It’s not a legal document (it is not binding) however it conveys your thoughts, dreams, and feelings regarding the care of your dependent.
It describes a day in the life of your dependent, likes, dislikes routines, favorite foods, thoughts on religion, dating etc…
Social interests. “My son loves to go to a baseball game each year.”
Lists the doctors you like and those you would NEVER visit again, it lists medications, therapists, services, etc…
We can help you create one, I’ve seen all types some long, some short, most are written, and some are in video format.
What’s right for you? That depends on your situation.
Step 10: The Letter of Intent
1. For more information regarding benefits provided Medicaid (Medi-CAL in California) visit Medicaid guidelines vary by state. Contact your local Medicaid office for details. For more information on SSI visit

16. How Do I Start The Planning Process?
With Special Needs Professionals:
Legal Estate & Special Needs Attorneys
Financial Professional with a focus on Special Needs
How do I get started?
There are two types of estate planners, legal and financial.
Most legal estate planners will direct you to go to a financial professional first. It’s critical to determine what is needed prior to the trust being drafted.

17.
Thank you!