What to Consider When Appointing a Fiduciary?

A well-crafted estate plan will require a person to appoint individuals or financial institutions to represent them in the event they: need assistance with their affairs during their lifetime, lose capacity, or after death. Being a fiduciary is a very time intensive and intellectually challenging task to put upon an individual. The common fiduciary positions that your estate planning lawyer may ask you to name are as follows:

Personal Representative: appointed by a Court to administer your estate when you die;
Agent-In-Fact (under a durable power of attorney): manages your financial affairs during your lifetime;
Health Care Surrogate: makes health care decisions for you during your lifetime;
Trustee of a trust document: administers the terms of a trust that you have created;
Guardian: makes health care and financial decisions for you in the event that less restrictive alternatives are ever deemed insufficient by a Court during your lifetime; and
Guardian for your minor children: makes decisions for your children in the event you pass away or lose legal capacity before the children become legal adults.

The individuals or financial institutions that you choose to serve in these various fiduciary roles will have substantial responsibilities that will require them to make decisions or act actions on your behalf such as follows: apply for government benefits; make health care decisions; manage and invest your assets and income for your benefit (or others as you have chosen); decide where you will live; work with attorneys, financial advisors, and accountants; and distribute your assets upon your passing.

Often times a person will name their spouse or their oldest child as their fiduciary because they assume that its typical for estate planning, but some more thought should go into these decisions and you should consider the following questions:

Does this person have the education, experience, and skillset to manage my financial affairs?
Is this person too busy to take the time to serve as a fiduciary for me?
Can this person make a difficult decision regarding my health care?
Would this person make the same health care decisions that I would make for myself?
How close does this person live to me?
How old is the person I am appointing and will they be around to serve as my fiduciary in the future?
Will appointing this person create a divide amongst other family members?
Does the size of my assets and income require a professional such as my accountant or a financial institution to manage?

The above are just a few items to consider about when choosing fiduciaries to name in your estate planning documents. However, only you know who the right person(a) or financial institutions are for you in these fiduciary roles. I recommend spending a little time considering which person(s) or financial institutions are right for you prior to meeting with your estate planning attorney.

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Kevin Albaum

Associate at Clark, Campbell, Lancaster & Munson, P.A.

Kevin Albaum was born and raised in Tarpon Springs, Florida. He grew up spending a lot of time on the water either boating, fishing, wakeboarding, or jetskiing. Kevin earned his bachelor’s degree at Florida State University where he competed for FSU’s mock trial team across the country. Immediately upon graduation, he enrolled at Stetson University’s College of Law in Gulfport, Florida due to their specialty program in elder law and his passion for that specific field of the law.

Kevin moved to Lakeland, Florida to join Clark, Campbell, Lancaster, and Munson where he practices in the areas of: elder law, guardianship, estate planning, trust administration, and Medicaid. Since moving to Lakeland, he has become involved with the Alzheimer’s Association Walk Committee, EMERGE Lakeland, and VISTE.