22 - The Types and Responsibilities of a Fiduciary

Episode Summary  

There are four types of fiduciaries. Serving as a fiduciary comes with great responsibility and takes a lot of work. Whether choosing a fiduciary or agreeing to serve as one, it’s important to understand what the role requires. As Bellomo and Associates prepares to launch its new fiduciary workshop, Jeff introduces us to the various fiduciary types and what is expected of them. 

Key Takeaways 

01:29 – What is a fiduciary?

Someone to whom property or power is entrusted for the benefit of another

Four types of fiduciaries: financial power of attorney, health care power of attorney, executor/executrix, trustee

02:05 – Our growing lineup of workshops

Will soon launch a new fiduciary workshop 

Current workshops: probate and trust administration, pre-planning, crisis planning, special needs

04:27 – Serving as financial power of attorney 

An advocate to tend to the finances and make sure bills are being paid

Make important financial decisions

Impartial, assertive, detail-oriented, organized, diligent, competent 

Living locally is helpful 

06:26 – Serving as health care power of attorney

Make sure individual’s health care needs are being met

An advocate for important health care decisions

A background in health care is helpful

Impartial, assertive, detail-oriented, organized, diligent, competent 

Consider choosing a retired health care provider (e.g., nurse or social worker) who is knowledgeable and trustworthy

10:20 – Serving as an executor/executrix 

Executor (male) or executrix (female) of the last will and testament

An advocate to carry out the wishes of the testator

Responsible for bills, taxes, liabilities, and distributing the assets according to the will

Receives authority when they receive the “letters testamentary” after the probate petition

Gifting assets or naming children as joint owners on accounts is not recommended in many cases

15:15 – Serving as a trustee 

Different types of trusts can be created for a variety of reasons: taxes, asset protection, etc. 

The person appointed as trustee will likely vary depending on the type of trust  

Special needs trusts will usually require a professional fiduciary (e.g., Achieva or Security Trust in Pennsylvania)

A professional fiduciary, such as a trust company or an insured professional, is recommended when the trust is meant to serve someone who is not responsible enough to manage the money or when extreme wealth is involved

Choose a fiduciary who is good with money, impartial, assertive, organized, detail-oriented, diligent, and competent 

A person can be the trustee of their own asset protection trust, and this often calls for a second person to serve as co-trustee

Links and Resources Mentioned

 Bellomo & Associates workshops, including “The Three Lands of Estate Planning”: 

https://bellomoassociates.com/workshops/ 

For more information, call us at (717) 845-5390.   

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