The Estate Planning Cast of Characters

The Estate Planning Cast of Characters

What’s the role of successor trustees, professional fiduciaries, guardians, and personal representatives? What’s the difference between a health care agent and a financial agent? These are important questions to answer as you’re thinking about your estate plan.

Who should I pick as successor trustee?

For most trusts, you are going to be the initial trustee for your own trust. You will need to select a successor trustee to act when you are no longer able. To figure out how to select the right person for the job, first consider whether the trustee should be an individual or a financial institution. If choosing an individual, pick someone you know who is diligent, detail-oriented, and whom you trust to carry out your clear instructions.

What does a successor trustee do?

A successor trustee (either an individual or institution) serves as a back-up, or replacement, to the original trustee (usually you) when the first trustee passes away or is incapable or unwilling to perform their management duties. As successor trustee, he or she will be in charge of managing the assets owned by the trust and ensuring that the assets are managed or distributed according to the terms of the trust.

Should I pick a professional fiduciary?

While it’s straightforward enough to pick a friend or family member you think will be up to the task, picking a corporate trustee or professional fiduciary company is the best option for some people. Trust companies and professional fiduciaries that focus on trusteeship provide expert management. Being unrelated to your personal life, you can also rely on them to be impartial. However, these professional trustees do charge for their services and may have minimum asset requirements.

What does a guardian do?

Guardians and conservators are court-appointed individuals who make decisions on a person’s behalf in the event of mental or physical incapacity. These decisions can range from where you live to making sure that your bills get paid. These court-supervised helpers can be avoided by adding proper powers of attorney, and explicit directions for them, to your estate plan.

What’s the difference between my health care agent and my financial agent?

While there is some overlap, health care and financial agents are two distinct roles in an estate plan. Your health care agent, also referred to as health care power of attorney or health care proxy, is responsible for making medical decisions on your behalf and may also implement your pre-arranged instructions if you experience incapacity. Likewise, a financial agent can manage your money by paying bills, filing taxes, purchasing insurance, and adjusting investments for you if you become unable to do so yourself. You may choose to appoint the same person or you may select different people. It’s up to you to decide who is best for each role.

What does personal representative mean — is that different than an executor?

A personal representative is the same as an executor. Many states no longer use the term executor and replaced it with personal representative. This is the individual or institution named in a will who becomes responsible for carrying out the instructions provided in your will during the probate process.

If you have questions related to estate planning, give us a call today.



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