Written by Jason C. Henbest, Esq. and Brittany Saxton
Sometimes in law, the legalese is tough to understand. Yet, some legal terms do not have simpler synonyms. When there is a necessity to deal with the law, it is very important to understand the meaning of the term you are working with. One of these seemingly complex, but in fact easy, legal terms is fiduciary. Derived from the Latin fiducia, meaning “trust,” a fiduciary is a person who has the power, responsibility and obligation to act on behalf of another. A fiduciary can be a person or an institution. Some common fiduciaries include business advisers, bankers, stockbrokers, accountants, financial advisors, mortgage brokers, real estate agents and attorneys. These individuals are hired to advise and guide you in your best interests, setting aside their own personal motives and goals.
Fiduciaries are a major part of the estate planning process, as well. Take for instance Executors and Personal Representatives. This type of fiduciary is appointed in a Will, and is responsible for administering your estate. Another example is a Trustee, who is responsible for managing the assets created in accordance with a trust agreement. Also consider a healthcare agent, who is appointed in your Living Will and responsible for making medical decisions on your behalf. There is an Attorney in Fact, responsible for managing the assets in your name in accordance with the Power of Attorney. And finally, there is the Guardian, which can be appointed in a Power of Attorney to take care of you and your property in the event of incompetence, or a Guardian appointed in a Will to take care of minor children.
It is important to note that there can be more than one individual appointed. In fact, it is more reassuring to have “back-ups” in the event that your first choice cannot serve or chooses not to serve for any reason. Overall, getting acquainted with the terms used in the estate planning process will make discussing your wishes with your attorney much easier. Consult your attorney about the role of the fiduciaries in drafting your estate planning documents today.
Manahawkin and Stafford Township Attorney | Fiduciary | Estate Planning