The Fiduciary View – Choices and Consequences
by Marguerite Lorenz, a Professional Private Trustee
Questions and Answers about fiduciary services from one of the top fiduciaries
in Southern California.
Q: My son is a real estate broker who lives in Arizona. Shouldn’t I name him as my Successor Trustee?
A: Being trustee of someone else’s trust, especially a family member’s trust, is a big job.
A short list of what your trustee is expected to do:
- Follow the California Probate Code
- Produce formal accountings, detailing all financial transactions
- Put the needs of the client first, and the beneficiaries second
- Make decisions regarding investments, quality of life and tax consequences
If your son is like many other professionals, he is busy building his business, 40 to 60 hours a week. If he also has a wife and children, being with his family may mean another 10 to 20 hours a week of his time and attention. He may need some time to rest, maintain his home or visit with friends.
The adult children of elderly parents often feel so much pressure; Pressure to care for their own young children, pressure to run their business or do their job while planning for their own retirement, and pressure to maintain their marriage and social obligations.
Add the fact that the adult child lives far away and is suddenly expected to care for one or both elderly parents.
What are the elderly parents actual needs and how do those needs get met? What other family members are going to assist and if they don't assist, what actions taken will they criticize? What obligations would your son have under the Probate Code and applicable tax laws? Does he have the time necessary to review all the details and avoid costly errors?
Even if you have a great relationship with your son, his development of resources (like hiring a qualified care giver or selecting an assisted living residence), during a time of crisis, can be the most challenging. You and your loved ones are at your most vulnerable, unless there is a plan already in place.
In many cases, while I serve in the capacity of Trustee, Executor and Attorney-in-Fact, I often recommend that a family member, even if living out of state, act as the first Agent for Health Care. Most decisions can be initiated by phone, fax or email, saving travel for when absolutely necessary. We are often named as "Alternate" agents under this document, in case the first agents cannot be reached or cannot serve.
The duty as Agent (under the Advance Health Care Directive) generally begins when the elderly parent can no longer speak for themselves in terms of medical decisions. It is a great comfort to all concerned that family is involved when a serious illness occurs. It is of equal comfort that a trusted professional handles the financial and logistical issues objectively and efficiently.
You can be of great service to your adult children, aging parents, and your self by getting the Estate Plan done with the right team ready to serve. Contact an experienced Estate Planning Attorney today to make sure your plan is in place.
Marguerite Lorenz, EA, CCF, CTFA
Enrolled Agent
Certified California Fiduciary
Certified Trust and Financial Advisor
Lorenz Fiduciary Services, Inc.
Professional Trustees and Executors
PO Box 3010
Fallbrook, California 92088
Ph: 760-728-6688
Fx: 760-728-7080
