Properly drafted estate planning documents are integral to the success of your legacy and end-of-life wishes. Iron-clad estate planning documents, written by a knowledgeable attorney can make the difference between the success and failure of having your wishes carried out. However, there’s more to estate planning than paperwork. For your wishes to have the best chance of being honored, it is important to carefully choose the people who will carry them out.
Your estate plan can assign different responsibilities to different people. The person who you most trust to raise your children, for example, may not be the person you’d designate to make health care decisions on your behalf, if you are incapacitated. Before naming individuals to carry out your various estate and incapacity planning wishes, you should carefully consider the requirements of each role and the attributes which each individual has that will allow him or her to perform the duties effectively.
Personal Representative. You name the Personal Representative, (also known as the executor), in your will. This person is responsible for carrying out all the terms of your will and guiding your will through probate, if necessary. The Personal Representative usually works closely with a probate or estate administration attorney, especially in situations where will contests arise and your estate becomes involved in litigation. You may appoint co-Personal Representatives to work together or appoint backup or alternate Personal Representatives.
Health Care Agent. Your Health Care Agent is the person you name to make medical decisions for you in the event you are incapacitated and unable to do so yourself. In addition to naming a Health Care Agent (sometimes called a health care power of attorney), most people also create a living will (or health care directive), in which they directly state their wishes for medical care and end-of-life care in the event of incapacity. When choosing a Health Care Agent, select a person who you know understands your wishes regarding medical care, and who you trust to carry out those wishes, even if other family members disagree. You should also consider individuals who have close geographic proximity to you as well as persons you believe can make difficult decisions under pressure.
Attorney-in-Fact. A financial power of attorney (or simply power of attorney) is different from a health care power of attorney in that it gives another person (known as your Attorney-in-Fact) the authority to act on your behalf in financial matters including banking, investments and taxes. You can limit the areas in which the person may act, or you may grant unlimited authority. A power of attorney may also be limited for a specific time, or it may be a durable power of attorney, in which case it will continue even after the onset of incapacity (until your death). A power of attorney can take effect immediately or “spring” into effect in the event of incapacity.
Guardians. If you have minor children or other dependents (disabled adult children or other disabled adults for whom you are the named guardian), then your estate plan should name a person or persons to take over the parental role in the event of your death. The guardian may also have control over any assets that you leave directly to your minor children or other dependents. If you create a trust for the benefit of your minor children, then the trust’s trustee(s) will have control over those assets and their distribution. Important considerations include age of the guardian, compatibility with his or her personality and moral values as well as the extent and quality of the existing relationship with your children.
Trustee. If you place any assets in trust as part of your estate plan, then you must designate one or more trustees, who will act as the legal owners of the trust. If you do not wish to appoint someone you know personally, you may appoint a corporate trustee – often a bank – to play this role. Corporate trustees are often an excellent choice, since they are financial professionals and neutral, objective third parties, but you do pay for their services. It is important you select individuals who are not only trustworthy but also organized, diligent and detail oriented.