Frequently Asked Questions
The information provided below is from the perspective of a professional fiduciary and is not intended to be construed as legal advice. If you have questions regarding your estate plan, you should consult with a qualified estate planning attorney.
Who needs an estate plan?
Everyone should consider doing some form of estate planning, regardless of how much your estate is worth. At the very least, everyone should have a will that designates what they want to have happen to their money and their possessions after their death and who they want to be in charge of overseeing the distribution of their assets and the winding up of their estate (the Executor of their will). You should also have an Advanced Health Care Directive and a Durable Power of Attorney for health care and for finances that designates someone you trust to act on your behalf as your agent should you become ill or incapacitated and unable to act for yourself. The greater the total value of your estate, the more important it is that you meet with an estate planning attorney to evaluate the options available to you to minimize the amount of taxes that have to be paid out of your estate upon your death and to control the timing of distribution and to maximize the amount of your assets that can be passed on to your designated heirs or beneficiaries.
What is a professional fiduciary?
A professional fiduciary according to the State of California is:
- any person who acts as a conservator or guardian for two or more persons, at the same time, who are not related to the professional fiduciary or to each other by blood, adoption, marriage or registered domestic partnership.
- a person who acts as a trustee or an agent under a durable power of attorney for healthcare or for finances for more than 3 people or 3 families, or a combination of people & families that total more than 3, at the same time, who are not related to the professional fiduciary.
The State of California requires professional fiduciaries to be licensed by the State. Certain professionals are exempted from this requirement such as attorneys, CPA’s or enrolled agents, brokers or security dealers registered with the SEC, certain financial institution and trust company employees and employees of certain State agencies. In order to become licensed in California, an applicant has to submit an application incorporating a criminal background check and documentation of having met minimum requirements for education and or experience working as a fiduciary. Prior to receiving approval for licensure, an applicant must also take and pass an exam administered by the Centers for Guardianship Certification demonstrating their knowledge of the probate laws and the obligations and responsibilities of serving as a fiduciary.
What is most important to consider when deciding who to designate as Executor of my will, Trustee of my estate and/or my Agent under a Durable Power of Attorney?
The individual or company that you choose to fill any of these fiduciary roles should be one that you trust to administer your estate according to your expressed wishes or instructions. They should have the maturity, integrity and experience to serve impartially and place the needs or interests of all of the parties they represent ahead of their own. While it is often more efficient to appoint the same party to serve in multiple roles such as trustee, executor and agent under a durable power of attorney for finances, it is not essential and you may be more comfortable designating different parties for different fiduciary roles.
While it is most common to designate family members to serve as your fiduciary, it is not always possible or appropriate depending upon individual circumstances. When it is not possible or practical to name a family member as your fiduciary, you will want to consider designating a professional fiduciary.
How do I go about finding and evaluating Private Professional Fiduciaries?
If you are considering a private professional fiduciary as part of your estate planning or need one to step in to assist or replace the current fiduciary, you probably want to start with referrals from your estate planning attorney or other professionals such as your CPA or financial advisor. They will most likely have prior experience with private fiduciaries or know of several individuals in your community with whom you can consult. Everyone’s circumstances are a little different so you want to find a private fiduciary whose experience and background best fit your circumstances. You can also contact the California Professional Fiduciaries Bureau who licenses fiduciaries in the State or access their website at www.Fiduciary.ca.gov for a list of licensed professional fiduciaries in your county. The Professional Fiduciaries Association of California (PFAC) also can provide a list of members in your community at www.PFAC-pro.org.