Roles of a Fiduciary
What is a Fiduciary?
A fiduciary is an individual or company you can name in your estate planning documents for a range of services from assistance with a particular task to serving completely in this role for you. This includes ensuring important medical and financial decisions are made, funds management, trust administration, benefits navigation, and management and/or advocating.
What is a Professional Fiduciary?
In Arizona, professionals who assist you or serve in fiduciary roles hold a license and are overseen by the court system. Since they are bonded and must adhere to strict requirements by law, you benefit from a specialized relationship with multiple layers of protection in place.
Fiduciary Services
- Guardianship — Individual appointed by the court to make medical, shelter, education and some personal decisions on behalf of an adult with special needs.
- Conservatorship — Individual appointed by the court to manage income, assets and payment of expenses for an adult with special needs.
- Trustee — Individual or institution named in a trust responsible for managing income, assets, expenses, tax filings, distributions, etc., in accordance with the terms of the trust document.
- Special Needs Trustee — Trustee who specializes in administration of a trust that was drafted to protect the beneficiary’s benefits (such as Social Security and Medicaid) and who works to ensure its administration is in compliance with the agencies providing the benefits.
- Personal Representative/Executor — Individual appointed by the court, or named in the last will and testament, who is responsible for administering an estate following someone’s death. (This is not the same as a beneficiary, who is the recipient of a designated part of an estate.)
- Agent Under Power of Attorney — Individual designated in a document to manage one’s affairs if he/she becomes unable to do so. (There are many types, both for financial affairs and health care.)
The Importance of Planning Ahead
It is important to plan ahead in regard to who will serve in any of these roles for your loved one. Administering documents can involve a significant amount of work, depending on the circumstances. You may not want to burden a sibling or another family member with worrying about complying with rules of federal and state agencies. You may want your loved one to receive an inheritance when you pass, but not necessarily have to coordinate taxes, property cleanup and sale, etc.
Questions to Consider With Your Lawyer
- Should I nominate a professional? What are the pros and cons of a professional versus a family member?
- Is my loved one going to live in Arizona?
- What assets and/or income need to be managed?
Finding the Right Professionals
Selecting the right attorney, planner or other professional is vital in planning for the future of a special needs child. The following resources are designed to help you make the right choice: