Estate plans include many components. In addition to detailing your preferences and wishes, you must also name trusted individuals to bear certain responsibilities. You can name one or several people for different roles, plus include backups. Here’s a closer look at the 4 trusted roles in estate plans and who may be best suited for each.
1 – Power of Attorney for Financial Affairs
A power of attorney for financial affairs allows someone to make financial decisions on your behalf when you are still living but are incapacitated or disabled. This includes having access to your bank accounts and credit cards, accepting income, and paying debts. There is no daily oversight by third parties, so you must thoroughly trust this individual with all money matters. The role is best suited for someone who is financially stable and is good at managing their own finances.
2 – Health Care Proxy
A healthy care proxy empowers someone to make decisions on your medical care. Again, this applies when you are unable to do so yourself due to incapacitation or disability. It’s helpful if your proxy is comfortable speaking to medical professionals and understands basic medical terminology. Given the emotional aspect of this role, you’ll also want someone who can think clearly under such pressure and make decisions that will honor your wishes.
3 – Personal Representative (Executor)
Another of the trusted roles in estate plans is an executor (known in Massachusetts as a personal representative). Unlike the other two roles listed above, an executor becomes active only after your death. The role includes a wide range of responsibilities including (but not limited to) managing financial accounts, selling assets, navigating court processes, accounting for funds, and distributing assets to heirs. Depending on your estate plan, it can be a short-term role of 6 months to a year or a one that extends for many years. In addition to being trustworthy, executors should also be organized and with a well-rounded skill set.
4 – Guardian for Dependents
Last, but certainly not least, is the role of guardian for your children. Guardians take on your parental role and will care for your children until they become adults. This is by far the most difficult role to assign. Be sure to read our articles on the qualities of a good guardian and other important considerations.
More on the 4 Trusted Roles in Estate Plans
For the 4 trusted roles in estate plans, it’s important to select people that you know and trust. Each is essential and require different skillsets. So, you might not assign the same person to all of them. Additionally, consider the potential conflict of interest. For instance, someone responsible for your finances is not best to decide whether to artificially extend your life or terminate care. Ultimately, it comes down to the characteristics of the people closest to you and your assessment of what they are capable of and can be trusted with. The decision is truly a personal one, although understanding each role can certainly help.
Contact our team for assistance with this and other important estate planning decisions. We will prepare a comprehensive plan to protect your rights while you are living and your assets and heirs upon your death.