A fiduciary is someone whom you authorize to make decisions on your behalf under certain circumstances. Fiduciaries can play many roles in your estate plan. For example, the executor of your will acts on your behalf after you die, while a health care power of attorney or proxy acts on your behalf if you are incapacitated and no longer able to make your own decisions. You can name the same person to multiple fiduciary roles if you wish, but it might be a good idea to spread the responsibility around so that one person doesn’t feel overly burdened.
Regardless of whether you intend to name one fiduciary or several, there are some important questions you should ask about your choices before you decide.
1. Is the Person Close to You?
This can be either an advantage or a disadvantage. A person who is not close to you may not be very invested in your interests. On the other hand, a person who is close to you may not be able to put emotions aside to make objective decisions based on what you want. You should weigh the pros and cons of each when deciding on a fiduciary.
2. Is the Person Trustworthy?
This is an essential quality in anyone whom you choose as a fiduciary. You need someone whom you can trust to understand your wishes and put your interests above their own. You also need to be able to depend on the person to see an obligation through to the end, even if it becomes difficult or lasts longer than expected.
3. Does the Person Live Near You?
You can choose almost anyone as a fiduciary, regardless of his or her location. It is not required that the person live nearby. Nevertheless, it can be easier on everyone, including your fiduciary, if he or she is in close proximity and doesn’t have to make frequent cross-country trips to fulfill his or her duties.
4. Is the Person Physically and Mentally Able To Serve?
Typically, a person has to be at least 18 years old to have the legal status to serve as a fiduciary. Rarely, if ever, is there any upper age limit. Nevertheless, you should consider the individual’s age and state of physical and mental health, and whether this is likely to decline in the future when the estate plan eventually goes into effect.
One of our estate planning attorneys may be able to answer questions about fiduciaries and help you create a plan that serves your needs.