Posted by: The Life and Legacy Planning Group
We rely on our friends, family, and colleagues to help us through life’s challenges. These trusted individuals can also be incredibly important when setting up an estate plan. It is vital to appoint a fiduciary to act on your behalf. There are a number of fiduciary positions in an estate plan, potentially a Trustee, an Executor, a Guardian for a minor or disabled child, an Agent under a Power of Attorney for Property, an Agent under a Power of Attorney for Health Care, an others. A fiduciary carries out your wishes should you become incapacitated or pass away. Legally bound to make decisions with your best interests in mind or in accordance with your written instructions, the fiduciary is invaluable in times of uncertainty.
Many people select a single fiduciary to manage their affairs. However, the amount of time associated with the role can be overwhelming for some people. When deciding who to appoint as fiduciary, be mindful of the degree of effort associated with maintaining and managing your affairs.
In some cases, you may want to nominate co-fiduciaries to act under certain documents (co-fiduciaries are not permitted as Agents under Powers of Attorney in Illinois). This ensures that there is always someone available to act even in the event of the death, incapacity, or unavailability. Of course, choosing more than one fiduciary has its drawbacks. If you choose to have more than one, you will need to decide if they must act unanimously, or if one can act on your behalf without the consent of the other. If an even number of fiduciaries is named, serious tension can arise when important decisions need to be made. If you require a unanimous decision be made, a deadlock can happen. To avoid this issue, you may want to nominate more than just two fiduciaries, or name another individual to cast the deciding vote in these instances.
Co-fiduciaries may also struggle to coordinate schedules, especially if they are located in different geographical areas or have demanding jobs. Regardless of whether a unanimous decision is required, it is crucial for everyone to be involved in the process of making big decisions on behalf of a loved one. That said, it is also important that all parties involved in the decision-making process get along – which is no easy feat in some families.
Nevertheless, the benefits of having co-fiduciaries may outweigh the drawbacks. If you’re confident that the people you select can get along and make good decisions together, and there are appropriate provisions written into your estate planning documents to address the risk of deadlock, it may be worth appointing several trusted fiduciaries.
Should you decide to appoint just one person as fiduciary to a given position, you have a couple of options. As previously discussed, appointing a trusted family member or friend can be a good choice depending on the type of work involved. However, if you do not want to pick one person over another, if your loved ones are not able to act on your behalf, or if you simply don’t want to burden a family member, look to a professional to represent your needs. They’ll generally be more available to manage your assets and make unbiased decisions based solely on your wishes and best interests. Although appointing someone outside of the family may ruffle some feathers initially, it can lead to less animosity after you pass.
Whether you opt to appoint several fiduciaries, family members, or trusted professionals, it’s always smart to be proactive and to plan ahead. Although it might not seem pressing right now, selecting a fiduciary can help you protect the legacy you have worked so hard to build. Should you become incapacitated, you’ll be grateful to have someone you can trust represent you in managing your property, taking care of your finances, and addressing other legal matters, instead of having the court appoint someone at random that you probably would not have chosen.
Get the guidance you need to plan for your future. We are here to help memorialize your wishes to protect your loved ones and safeguard your assets.