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Selecting the Right Fiduciaries for Your Legacy Plan

By now you know that you need some kind of a plan for your assets, whether you choose a basic Will and probate-avoidance administrative tools or whether you choose a trust. One of the first questions you will be asked by your attorney is whom you want tasked with carrying out your plans!

A fiduciary is someone who is legally responsible for managing your assets and affairs. This can include things like paying your bills or investing your money (power of attorney/conservator), and distributing your property after your death (executor/trustee). When you are creating your estate plan, it is important to spend some time carefully selecting your fiduciaries. The wrong choice could lead to problems for your loved ones and your estate.

Here are some factors to consider when selecting fiduciaries:

senior man having family dinner with two younger women

Relationship: You should choose fiduciaries whom you trust, who have a good relationship with you, and who can have a productive and professional relationship with your beneficiaries. When it comes to a power of attorney or conservator, they should be someone who is trustworthy, who you feel comfortable with, and who you believe will act in your best interests. When it comes to an executor or trustee, they should be able to successfully get along with other helpers such as your accountant and banker. If you have a complex or dysfunctional family dynamic, they might need to be able to withstand pressure from beneficiaries. While most people select their spouse or children, this is not the right choice for everyone. Talk through the foreseeable problems with your attorney.

Capacity: The fiduciaries you choose should be mentally and physically capable of handling the responsibilities of the position. They should be able to understand and follow your instructions, and they should be able to make sound financial decisions. The older or more infirm you are as a couple, the less likely it is that your spouse is the right person for the job. And selecting an older sibling when you are already a senior citizen may create the need for a good backup plan. You should not choose your child if you have had serious concerns about their mental or financial health.

Availability: The fiduciaries you choose should be available to handle your affairs. This means that they should be willing and able to meet with your loved ones, pay your bills, and make investment decisions. While you can choose whether or not to allow compensation for your executor or trustee, this does not necessarily mean that a person who is working full time or raising a family can create space for your estate in their schedule. At the very least, you should have a conversation with that person and secure a commitment to carrying out the duties.

Skills: The fiduciaries you choose should have the skills and knowledge necessary to manage your assets. If you have a simple estate, your fiduciary may only need the skills to talk to and hire professionals (like accountants or lawyers) to complete certain tasks. If you have a complex estate, you may want to choose a professional fiduciary, such as an attorney or a financial advisor. Seek referrals from other people who have had good experiences with professional fiduciary companies.

In addition to these factors, you should also consider the following questions when selecting fiduciaries:

  • Are they willing to serve as fiduciaries?

  • Do they understand their responsibilities?

  • Are they comfortable with the level of responsibility involved?

  • Are they located in a convenient location?

Once you have considered all of these factors, you can start to narrow down your list of potential fiduciaries. It is a good idea to have at least two fiduciaries in place, in case one of them is unable to serve.

If you are unsure of how to select fiduciaries, you should talk to an estate planning attorney. They can help you understand your options and make the best decision for your estate.

If you get stuck, check out these additional tips for selecting fiduciaries:

  • Talk to your family and friends. They may be able to suggest people who would be good fiduciaries.

  • Do your research. Check the background of potential fiduciaries to make sure they are trustworthy and competent.

  • Get everything in writing. Once you have chosen your fiduciaries, you should put your wishes in writing in a will or trust. This will help to avoid confusion or conflict after your death.

I would be happy to help you ensure that your assets are managed properly after your death by crafting a plan that works. With proper planning, you can help to protect your loved ones from unnecessary stress and conflict.

This post was created with the assistance of Bard, an AI solution from Google.

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