When creating your last will and testament as part of estate planning, an important decision you will have to make is who to name as your executor fiduciary. By fiduciary, I mean your Executor under your Last Will and Testament. An estate fiduciary is a fancy legal term for the person who will take care of your assets and Estate if you are unable to do it yourself, such as the 1) executor of an estate, 2) the trustee of a trust, or 3) an attorney-in-fact under a power of attorney. Your first reaction might be to name one of your children as a fiduciary, but if you want to avoid conflict among your children, this might not be the best option.
When naming a fiduciary, be confident you can rely upon the individual. This is why people often name family members as fiduciaries. However, problems can arise when a parent with two or more children names one child as a fiduciary. According to Fredrick P. Niemann, an attorney from Freehold, New Jersey, who spoke on the issue of family harmony at a recent will seminar, a child is often not the best fiduciary for several reasons:
• It is hard for a child to be completely objective.
• Children often disagree over many things, including how long the estate should take to complete, the selling of assets, and the division of personal property.
• Children often don’t communicate with each other well.
• Unresolved lifetime rivalries.
An alternative is to hire a professional fiduciary or executor. A professional fiduciary can be a bank, investment firm with estate administration experience, a certified public accountant, or a trust company. A professional fiduciary will charge a fee, but the fee is established ahead of time. In addition, because a professional is experienced in managing money and property, your assets are more likely to increase under this person’s or institution’s guidance.
To ensure that your family remains partially involved and has some input, you can include a provision that allows one or more family members to discharge the fiduciary if they feel the professional is not doing a good job. This will allow your family to make sure the fiduciary is performing properly without having the burden of acting as fiduciary.
For further information and advice in any estate planning matter or by the use of a will, do not hesitate to contact me toll-free at (855) 376-5291, or e-mail me at fniemann@hnlawfirm.com. We can meet to discuss your questions and issues. For further information, go to http://www.youtube.com/user/NJElderLawCenter#p/search/0/XfXdZF-5snk to learn more.
By Fredrick P. Niemann, Esq., a NJ Will Attorney