An estate plan does more than determine who receives your property after your death. It also answers some very important questions about what happens during your lifetime.
- Who can manage your finances if you cannot?
- Who will carry out the instructions in your estate?
- Who will manage a trust for the people you love?
- Who will make healthcare decisions if you are unable to speak for yourself?
These aren’t simply names that need to be added to legal documents. They are people you may someday entrust with significant responsibility.
For many families, a spouse, adult child, sibling, or trusted friend is the natural choice. But not everyone has someone who is both willing and well suited to serve.
Family relationships can be complicated. Children may live across the country. A trusted friend may not be comfortable managing finances. Family members may disagree with one another. Or the responsibility involved may simply be more than someone has the time or experience to manage.
In those circumstances, a professional fiduciary may be worth considering.
The important thing is not simply finding someone who can serve. It is thoughtfully choosing someone capable of faithfully carrying out the responsibility you are entrusting to them.
What Is a Fiduciary?
The word fiduciary can sound complicated, but the underlying idea is straightforward.
A fiduciary is someone who has a legal responsibility to act according to the authority they have been given, the governing documents, and applicable law.
Depending on your estate plan, fiduciary roles may include your executor or personal representative, trustee, or the agent serving under your financial power of attorney.
These individuals can be entrusted with substantial authority over your finances, property, or estate.
That is why choosing them deserves careful consideration.
You aren’t simply asking, “Do I trust this person?”
You should also be asking:
“Can this person faithfully carry out this responsibility?”
Luke 16:10 NIV: “Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much.”
When a Family Member May Not Be the Best Choice
Choosing a professional does not necessarily mean you don’t trust your family. Sometimes it means recognizing what a particular responsibility actually requires.
Administering an estate or trust can involve recordkeeping, financial management, meeting deadlines, communicating with beneficiaries, working with attorneys and accountants, and making decisions that may not satisfy everyone.
A family member may be deeply trustworthy and still not be the best person for that job.
In some situations, choosing a neutral professional can also help when family dynamics are complicated or when beneficiaries have competing interests.
Depending on your circumstances, options might include a bank or financial institution with a trust department, a private trust company, or another qualified professional who is legally permitted and willing to serve.
The right choice depends on your estate, your family, and the responsibilities involved.
Financial Decision-Makers in Your Estate Plan
Before choosing a professional fiduciary, it helps to understand the different responsibilities they may be asked to assume.
Executor or Personal Representative
Your executor or personal representative helps administer your estate after your death. That may include identifying and managing estate assets, paying valid debts and expenses, completing required filings, working with professionals, and ultimately distributing property according to your estate plan and applicable law.
Successor Trustee
If you have a revocable living trust, your successor trustee may take over management of the trust when you die, resign, or become unable to serve.
Depending on the trust and the circumstances, the successor trustee may manage property for your benefit during your lifetime and later administer or distribute trust property for your beneficiaries.
This responsibility can continue for years, making experience, organization, judgment, and long-term availability especially important.
Financial Power of Attorney Agent
The person serving under your financial power of attorney may be authorized to manage certain financial or legal matters on your behalf.
Depending on the authority you grant, that could include managing accounts, paying bills, dealing with financial institutions, or signing certain documents.
Because this person may be acting while you are still alive but unable to manage these responsibilities yourself, trust and accountability are especially important.
Questions to Ask a Professional Fiduciary
If you are considering hiring a professional to serve, don’t be afraid to interview them.
You are potentially placing significant responsibility in their hands. You should understand how they work before making that decision.
How Do You Charge for Your Services?
Understand the fee structure from the beginning.
Ask whether fees are hourly, based on a percentage of assets, subject to minimum charges, or calculated another way.
Also ask about additional expenses that could affect the estate, trust, or beneficiaries.
The least expensive option is not automatically the best choice, but you should understand what you are paying for and how those costs could affect your plan.
How Do You Maintain Records?
Good fiduciary administration requires careful recordkeeping.
Ask how financial transactions are documented, how records are maintained, and who will be able to access those records.
Accountability matters when someone is managing property for another person.
How Long Might Administration Take?
Every estate and trust is different, so there may not be a precise answer.
However, asking how long the professional typically takes to administer an estate or trust of similar size and complexity can help you better understand their experience, workload, and process.
How Do You Communicate with Families and Beneficiaries?
Administration involves people as much as paperwork.
Ask how often the fiduciary typically communicates, who serves as the primary point of contact, and how questions or concerns are handled.
Good communication can help reduce misunderstandings and unnecessary conflict.
Do My Estate Planning Documents Need Specific Provisions?
Some professional fiduciaries have requirements that must be included in the documents before they will agree to serve.
Find that out before your plan is finalized.
Your estate planning attorney can then review those requirements and determine whether your documents provide the appropriate authority.
What Have You Learned from Difficult Administrations?
Ask about both successful and challenging experiences administering estates or trusts.
Their answer may tell you a great deal about how they communicate with beneficiaries, approach conflict, solve problems, and define a successful administration.
You aren’t simply evaluating credentials. You’re evaluating how this person or organization may someday interact with the people you love.
Healthcare Decisions Require a Different Kind of Trust
Not every important role in an estate plan is financial.
Your medical power of attorney agent may someday be responsible for communicating with healthcare providers and making healthcare decisions when you cannot make or communicate those decisions yourself.
This requires a different set of qualities.
You may want someone who:
- Understands your wishes
- Can remain calm during difficult circumstances
- Is comfortable asking physicians questions
- Can advocate for you
- Is available when needed
- Will honor your decisions even when they might personally choose differently
An advance directive or other healthcare planning documents can provide additional guidance about your wishes.
You may also choose to leave written instructions explaining your preferences in greater detail.
The goal is not to ask your healthcare agent to predict what you would have wanted. It is to prepare them well enough that they can faithfully advocate for the wishes you have already expressed.
Don’t Forget the Animals Entrusted to Your Care
For many people, pets are an important part of the family.
But simply assuming that a friend or relative will take your pet is not a plan.
Talk with the person you would like to serve as your pet’s caretaker. Make sure they are willing.
Consider whether they realistically have the space, lifestyle, financial resources, and ability to provide the care your animal needs.
You may also want to provide written information about veterinarians, medications, feeding, routines, and other important needs, along with appropriate resources for ongoing care.
If a friend or family member is not an option, certain organizations may provide alternatives. Any arrangement should be researched and confirmed in advance rather than assumed.
Caring well for the animals entrusted to us is another responsibility worth planning for.
Questions to Ask Personal Care Decision-Makers
Whether you’re considering a trusted individual, professional, or organization, there are practical questions worth discussing before you name them.
Ask:
- Do you charge for your services?
- How should you be contacted if your help is needed?
- Is there additional information or paperwork you would need?
- Where should important documents and instructions be kept?
- Is there anything that would prevent you from serving when the time comes?
These conversations help turn an assumption into an actual plan.
The Right Person Is More Important Than the Obvious Person
One of the mistakes people can make in estate planning is choosing someone simply because they seem like the obvious choice.
The oldest child becomes executor. The closest sibling receives financial power of attorney. The child who lives nearby becomes the healthcare agent.
Sometimes those are excellent choices.
Sometimes they aren’t.
The question isn’t whether someone loves you. The question is whether they have the character, ability, willingness, availability, and judgment necessary for the responsibility you are asking them to carry.
And sometimes the wisest decision is recognizing that a professional may be better equipped to serve.
Have the Conversation Before You Make the Appointment
Whether you choose a family member, trusted friend, or professional fiduciary, talk with them before naming them.
Make sure they understand the role. Ask whether they are willing to serve. Discuss what the responsibility may involve. Find out whether they have questions or concerns.
And consider who should serve as a backup if your first choice is unable or unwilling to act when the time comes.
A name on a document is only part of the plan. Preparing that person to serve is part of the plan too.
Choosing Well Is Part of Faithful Stewardship
Estate planning asks us to make decisions today that may not matter for many years. That can make it tempting to choose the easiest option and move on.
But the people you appoint may someday be responsible for your finances, your healthcare decisions, your estate, the inheritance you leave your children, or even the care of a beloved pet.
Those responsibilities deserve thoughtful consideration.
At Faithful Stewardship Law Firm, we believe estate planning is about intentionally caring for the people, resources, and responsibilities God has entrusted to you.
Choosing the right people to carry out your plan is an important part of that stewardship.
You don’t need to have every answer before beginning your estate plan. And uncertainty about whom to choose should not keep you from moving forward.
We can help you understand the responsibilities involved, evaluate your options, and create a plan designed around your life and the people you love.