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Note: The views and opinions expressed here are those of the authors and do not necessarily reflect the position of the Morris County Chamber of Commerce.
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MCCC Blog |
Note: The views and opinions expressed here are those of the authors and do not necessarily reflect the position of the Morris County Chamber of Commerce.
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In addition to managing money, they may also take responsibility for medical and health care decisions or the care of your child should you pass away when the child is still a minor. Administrator Administrators are appointed for estates, where people did not have the opportunity to plan. Hopefully, if you care enough about estate planning to be reading this blog post, you’re never going to need an administrator appointed for your estate because you will have a will created. The only reason an administrator is appointed to be your fiduciary is if you have no will. Executor In New Jersey, an executor has the same function as an administrator, but the executor has been appointed in a will. The executor does not step in to act on your behalf until you have passed away, and your will has been probated. Typically, an executor is going to be in that role for about a year. It could be more, it could be less, but whomever you’re appointing as your executor would have the responsibility of collecting your assets, filing your last income tax return, filing any death tax returns that may be due for you – estate tax or inheritance tax, for example. Ultimately the executor has the responsibility of paying your creditors and then paying the beneficiaries of your estate. Trustee A trustee is the person who is responsible for supervising the assets of a trust, and making distributions or payments out of the trust, consistent with what the trust terms say. (For more about trusts, see blog post 7 in this series – “Trusts.”) A trustee can serve for a long time, depending on the terms of the trust. If there’s a trust that has a five-year term, then the trustee is going to work for five years. But if it’s a trust that’s for the lifetime of your minor child, and the trust document says that the trust will terminate when your child is 35 years old, you don’t know how long your trustee is going to serve because it would depend upon the date of your passing. But you know that you would need someone who could serve until your child reached age 35. Guardian For those who have children who are minors, the appointment of a guardian is where you say what is to happen and who is to take care of your children, if you are no longer here and can’t take care of them yourself. A mother and a father don’t have to name the same guardian for their children in their will. They can name different guardians, and if there’s ever a need for a guardian, it will depend on what’s said in the will of the parent who dies last. (However, we usually do recommend, if parents are getting a divorce that they both name in their documents the same person as the next guardian, so we don’t have “grandparent wars” or other disputes among family members about who is going to take care of the children.) Another type of guardian is the one who is needed when an individual has been found by a court to be incapacitated, which means that they are no longer able to manage their legal, medical, or financial affairs. (For more on guardians, see blog post 7 in this series, “Guardians and Guardianship.”) Attorney-in-Fact An attorney-in-fact, also called an agent under a power of attorney declaration, is a person you name who can act on your behalf – in essence, to be you – for legal and financial affairs during your lifetime. The power of attorney, however, terminates when you die. That is to say, when you die, it dies with you. Example. If you’ve appointed your daughter as your agent under your power of attorney, and you don’t have a will, your daughter would not be able to access your money when you are gone. After you die, if you don’t have a will, a judge will have to appoint an administrator to administer your will. If you do have a will, however, the executor you have named in your will steps in to administer your estate. You can extend the authority of your attorney-in-fact by giving them a “durable” power of attorney. When the individual named in your power of attorney declaration is given durable power of attorney, they can act for you when you are alive and, also, after you pass away. (For more on attorneys-in-fact, see blog post 3 in this series, “Power of Attorney.”) Healthcare Representative A healthcare representative is the person you’re appointing to be your mouthpiece to make medical decisions for you if you can’t make them for yourself. (For more on healthcare representatives, see blog post 4 in this series, “Healthcare Power of Attorney.”) Successor Fiduciaries With all of these fiduciaries you appoint, it is critically important to name successors. In the event your first choice of fiduciary cannot serve, a successor steps in to fulfill the fiduciary role. Successors are your fiduciary backup plan. In sum, as you do your estate plan check-up, think about the fiduciaries you have named: your executor and your trustee and guardian (if applicable). You can have the most gorgeous estate plan in the entire world. But it is the people that you name to carry it out that are going to determine how successful it is. Make sure that you’re naming fiduciaries and successors with whom you’re comfortable. Incidentally, the most frequent reason that estate plans are updated is to change who the people are in those fiduciary roles. Those sorts of changes can be done quickly – for example, as a codicil to the will or an amendment to a trust. This post is for general informational purposes only. The information provided may or may not apply to you given the specifics of your situation. For a video presentation of this information, please visit Estate Plan Check-up. For more detailed information, please visit porzioplanning.com or contact us for a free 20 minute telephone consultation. By Deirdre R. Wheatley-Liss, LL.M, CELA and Crystal West Edwards, Esq., CELA Comments are closed.
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Please Note: The views and opinions expressed here are those of the authors and do not necessarily reflect the position of the Morris County Chamber of Commerce.
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The Morris County Economic Development Alliance (The Alliance) is an affiliated 501c3 Nonprofit of the Morris County Chamber and includes the Morris County Tourism Bureau, the Morris County Economic Development Corporation and the Connect To Morris job board.
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