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Monday, August 2, 2010

Have you made legal guardianship arrangements for your disabled child?

When the parents of a disabled child think about estate planning, they of course consider the options open to them for Will planning. We'll get to those in a separate post, but in the meantime, the parents may also need to take some important steps that will take effect while they are still alive.

The first consideration is guardianship. I use this term as separate from trusteeship, or the custodianship of money. A guardian is someone who will look after where the disabled child lives, with whom the child lives, whether the child works on a paid or volunteer basis, and guides the child's daily life challenges such as grooming, transportation, education and entertainment.

Many parents reading the previous paragraph will dismiss it by thinking "we already do that for our child". It's possible that an informal arrangement works just fine for now. But what happens when you pass away? If your child is of the age of majority when you pass away, you can't appoint a guardian in your Will. You can do something about this while you are alive, if you wish to, but you cannot control it through your Will.

What if you should lose your mental capacity due to injury, illness or aging? Who will be making decisions for your child if you are having trouble making decisions for yourself? Would you like to have some input into who is put in charge of your child if you're not able to do it?

While your disabled child is a minor, there is no need for a guardian to be appointed, as the parents are automatically the child's guardians. Once the child reaches adulthood, however, it is a different matter. Adults are, in law, presumed to be competent to handle their own financial and non-financial affairs unless it is proved to a court of law that they are not. Therefore, as a parent, you may not have access to information or any control over decisions for your child once the child reaches the age of majority. This is where adult guardianship comes in.

In many cases, the disabled child doesn't have much in the way of assets while his or her parents are alive. Often the only asset that needs looking after is a monthly government benefit. If this is the case, it can be expensive and time-consuming to appoint a trustee who isn't really needed. However, a guardian to help with non-financial decisions most likely is needed.

In almost all provinces and territories, guardians may be appointed separately from trustees, so you can have a guardian appointed without going to the expense and trouble of having a trustee appointed. If you are the parents of a disabled child, you can both be joint guardians, but be sure to appoint a sibling or friend of the child as an alternate guardian for when both parents have passed away.

Make sure your estate planning includes a review of any and all steps you can take now to set matters up securely for your disabled child's future.

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