Choosing fiduciaries – How Do I Pick a Fiduciary?

Choosing fiduciaries – How Do I Pick a Fiduciary?

Choosing fiduciaries – How Do I Pick a Fiduciary?

When considering an estate plan many people focus on the big picture of what they want to happen and how it will happen after they have died. One area that is often overlooked is who will act on their behalf in those final years or months. At first glance, this may seem like a relatively straightforward question – if you have an estate plan, then everything should be taken care of. However, making sure that you appoint the right person to assist you if you are incapacitated should be an important element of every estate plan.  

At Kehoe Moneyhun Law, we focus on helping clients in Oregon and Southwest Washington create Wills, Trust Agreements, Powers of Attorneys, and Advance Directives to ensure that their end of life desires are honored. In this post, we will focus on fiduciaries who assist during a person’s lifetime. To learn more about personal representatives and the probate process, please read our blog HERE 

What is a fiduciary? What is a healthcare representative, an agent, and a guardian or conservator? How do they differ?   

A fiduciary’s responsivities may include financial assistance, such as, managing assets and paying bills. Or a fiduciary may be appointed to make medical decisions on your behalf. Generally, a fiduciary is held to a higher standard and must always act in the best interests of the person they are assisting.  

Fiduciaries can be appointed by an individual in estate planning documents. For instance, personal representatives are appointed in Last Wills and Testaments and oversee the management of an estate on death, healthcare representatives are appointed in Advance Directives and Healthcare Power of Attorneys and make medical decisions on your behalf, and Agents are appointed by a Power of Attorney and make financial and legal decisions on your behalf.  

In order to be valid, Oregon and Washington law require that each of these documents be made while the person has capacity to understand the documents they are signing. These documents are also usually signed before a notary or witnesses. 

Without proper documentation in place, if you become incapacitated you may need a court appointed guardian or conservator. A guardian is a court appointed representative who will “guard” your wellbeing and make medical and living decisions on your behalf. A conservator is a court appointed representative who will “conserve” your assets and make financial decisions on your behalf. Guardians and conservators are both considered fiduciaries. Court appointed guardians and conservators often require a lengthy court process and ongoing annual responsibilities to the court. Having a power of attorney and medical documents in place usually avoid the need for a court appointed guardian.  

As of December 2022, there were over 2.5 million individuals in the United States who have been appointed as guardians to represent another person’s best interests due to incapacity or maturity issues.  

How do you select a healthcare representative? 

Your healthcare representative is a person who will make medical decisions for you if you are unable to communicate your own desires. In Oregon, a medical representative is appointed through an Advance Directive or through a Healthcare Power of Attorney. You can learn more about the differences between Advance Directives and Healthcare Power of Attorneys (sometimes referred to as Living Wills), HERE

When choosing your medical representative, make sure that the person has an understanding of your wishes about end-of-life care and other important health decisions, including whether or not to use life-sustaining measures like ventilators and feeding tubes. For some people, a close family member or friend may be able to fulfil this role. For other people, a professional third party is the right person to make these decisions for.  

When deciding the right person to act as your healthcare representative, it is important to have conversations with them about your medical and end of life decisions. You will want to select a person who will 1) honor your desires, and 2) be able to make these difficult decisions on your behalf.  

Remember, not everyone is the right person for this job and making the decision to end life sustaining treatment, can be difficult for some people. Having these discussions in advance will inform you whether the person you are selecting is the right person for the job. If the person you are considering indicates that these end of life decisions would be difficult for them, then it may be best to consider hiring a professional.  

How do you select an Agent with a Power of Attorney?  

Having a valid Power of Attorney will often prevent the need for a court appointed conservator. With a Power of Attorney you appoint another person to act as your agent in all financial and legal situations. It is possible to draft “limited power of attorneys” that limit a person’s ability to act to limited situations. For instance, if you are traveling a need someone to sign closing paperwork for a property sale, you can sign a limited power of attorney that appoints another as your agent solely for the purpose of handling the real estate transaction.  

However, for long-term planning it is important to have a broad power of attorney appointing someone to act as your agent in most all financial and legal situations. When selecting this person, you will want to pick a person who is detail orientated, organized, and good at handling money and investments. Because you are allowing someone to have access to your finances, you want to select an individual who you trust implicitly to always act in your best interests.   

As we said before, not everyone is the right person for the job. You may have one person in your life who would be great with medical decisions but is terrible with finances. In this case it may be beneficial to hire a professional to handle your financial affairs and to make sure that your investments are invested soundly.  

Remember, you cannot nominate yourself as your own healthcare representative or agent, but you should pick a person who would act similarly to you in a situation. Family members and close friends are often a good choice and may be willing and able to take on these important roles in your estate plan. If there isn’t a person in your life who is quite right for these roles, then looking to a professional third party fiduciary is often a great choice. When choosing a fiduciary, it is important to think about how they will interact with other members of your family, as well as, how the fiduciary will work with attorneys and accountants to make sure all legal obligations are met. 

No matter who you choose as your healthcare representative or agent, having the proper documentation in place is an important part of every estate plan. At Kehoe Moneyhun Law we pride ourselves in guiding clients in Oregon and Southwest Washington through these important decisions with kindness and compassion. To find out more information, schedule an appointment HERE today.  



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