Section 3: Selecting the Right People for Key (Fiduciary) Roles
An important aspect to estate planning is choosing the right people to serve in various fiduciary roles because these are the people who will make critical decisions about your health, finances, and your children. It is important to take the time to carefully consider each role and select appropriate people and to have the conversation with them of your intent in selecting them for the role.
Guardians of Minor Children
Selecting guardians for your minor children is an important decision in estate planning. If both parents die or become incapacitated while children are minors, the guardians will raise your children, make day-to-day decisions about their lives, provide for their physical and emotional needs, and make decisions about their healthcare and education.
Considerations:
- Shared values
- Strong relationship with your children
- No requirement to choose family members
- Prioritize children’s best interest
You can name the same person as both guardian of your children’s person and guardian of your children’s estate, or you can select different people for each role. Commonly parents prefer to assign the same person for both so as to avoid potential conflicts.
Healthcare Agent
Your healthcare agent will make medical decisions on your behalf when you cannot, so this person must be willing to advocate for your wishes and make difficult decisions.
Many people name their spouse or partner as healthcare agent, but if you are not married or your spouse might be unable to serve due to the same incident that incapacitates you, consider back-up agent.
Trustee
For revocable living trusts, you typically serve as initial trustee, but you must name successor trustees to take over when you die or become incapacitated. For trusts for minor children, the trustee may serve for many years, so choose someone who can commit to long-term service.
Financial Agent
Your financial agent will manage your money and property if you become incapacitated, so this person must be completely trustworthy, financially responsible, organized, and capable of managing complex financial matters.
For married couples, spouses typically name each other as financial agent. For single individuals or as alternate agents, consider adult children, siblings, trusted friends, or professional fiduciaries such as attorneys, accountants, or trust companies. Professional fiduciaries charge fees but bring expertise and objectivity, which can be valuable particularly for complex estates or difficult family dynamics.
Executor
Your executor will manage your estate through probate. The executor will need to locate your assets, notify creditors and beneficiaries, file court documents and tax returns, manage and sell property, and distribute assets to beneficiaries. This process typically takes six months to two years depending on the estate's complexity.
Alternatives and Successor Fiduciaries
For every role, name at least one alternate in case your first choice predeceases you, becomes incapacitated, is unwilling to serve when needed, or moves away and cannot serve. Consider naming alternates in order of preference, such as first alternate and second alternate.
Review your fiduciary selections periodically, particularly after major life changes such as marriages, divorces, deaths, relocations, or changes in relationships. Update your documents if previously named fiduciaries are no longer appropriate.