Your fiduciary is an integral part of your estate
plan. Who should you appoint to coordinate your affairs upon
incapacity or death? Consider these questions when making the
selection:
In safeguarding your assets, fiduciaries must make prudent financial decisions.The complexity of such decisions depends upon the nature of your assets. For example, a closely held business is a more difficult asset to manage compared to a portfolio of marketable securities. Select a fiduciary knowledgeable enough to handle your specific assets.
It may be sufficient to name a certain fiduciary as your Personal Representative due to the limited nature of that role, while another fiduciary may be better suited to act as your Trustee.
Your family dynamics can impact your fiduciary selection. Your fiduciary must be able to communicate effectively with your beneficiaries.Your fiduciary should also show fairness and impartiality when beneficiaries have conflicting interests.If you foresee potential conflicts among beneficiaries, it is wise to select a fiduciary immune to such tensions.Consider the potential difficulties you may impose upon a neutral family member or friend.
Will my fiduciary charge a fee for its services?If you appoint a professional fiduciary, review their fee schedule carefully. Family members or friends sometimes forego taking such fees, also, these fees are subject to income taxation.
The selection of a family member or friend as your fiduciary may be tempered by personal goals.Do you wish to give your spouse an important role in the handling of your affairs?Do you wish to show your confidence in your child’s abilities?
An estate plan is designed to express your personal wishes, and your fiduciary selection can reflect those wishes as well.However, personal considerations should be weighed carefully against other relevant factors.
Consider appointing a family member or trusted friend as a co-fiduciary to act with a well suited individual or professional fiduciary.
