What is a Power of Attorney?

A power of attorney is a legal document where one person (the principal) authorizes another person (the agent) to act on the principal’s behalf. There are financial powers of attorney which allow your agent to make decisions regarding your property, and health care powers of attorney which allow your agent to make decisions regarding your health care needs.

Your power of attorney can be broad in scope, giving your agent the ability to make any and all financial and health care decisions for you or can be limited by specifying the types of decisions you would like your agent to make on your behalf.

In July of 2014, Pennsylvania significantly changed the law governing powers of attorney. Even if you already have a power of attorney, you should meet with an attorney to discuss whether your document should be updated.

What is a Guardianship?

Guardianship is a legal relationship whereby the court appoints a person (the guardian) to make personal decisions for another (the ward or protectee).

A family member, nursing home, or area agency on aging initiates the proceedings by filing a petition in the orphans’ court in the county where the individual resides. A medical examination by a licensed physician is necessary to establish the incapacity of the individual.

If a court of law determines the individual is unable to manage his or her financial resources and meet the essential requirements for his or her health and safety, the court may appoint a guardian to make financial and personal decisions for the individual. Unless limited by the court, the guardian has the same rights, powers, and duties over the ward as parents have over their minor children. The guardian is required to report to the court on an annual basis. 

The Differences

A power of attorney is a relatively low cost and private way to decide which family member or trusted friend will have the legal authority to carry out your wishes if you can no longer act for yourself.

If you do not have a power of attorney or if your power of attorney is not drafted properly and something happens that results in your inability to make decisions, your family/friends may face court proceedings and a court supervised guardianship. A court proceeding is not only costly, but the person appointed as your guardian may not be the person whom you would have chosen.