Should Your Agent, Trustee, Successor Trustee Also Be a Beneficiary?

Written By: Evie Curtis – Development Director, Assured Trust Company

It happened again. The conversation that starts with, “BUT, it’s my inheritance.” My reply, “BUT, it’s not your money. It belongs to Mom, Dad, Aunt, Uncle ….” It is the time when families have that moment – that moment when we realize money saved might actually have to be spent on our loved one’s care and not saving it for someone to inherit.

Full disclosure – I am not an attorney. I am someone who has worked with families facing some of the difficult decisions that will come up as we all age. Too many of us put off our planning until a crisis happens. We believe our families will have our best interest at heart. News flash – that was your family I was talking to in the previous paragraph.

What should you do? Plan and follow through (you will need an attorney) when you are not in crisis mode. Planning in crisis mode translates to the loudest voice in the room is heard (and it may not be yours). Know why you have chosen who will handle your affairs or help you should you be unable to do so. It should be more than, “he’s the oldest, she lives closest to me, I have no choice” or, sadly, the person that shows up – out of the blue – at your bedside in the hospital. Are you naming someone who knows your wishes, has the time or will make the time to help, and the capacity to understand what must be done or the duties required? This is also the time to consider adding a corporate fiduciary to your estate plan. Yes, they charge fees but at least they are unbiased, audited, follow the document terms, invest your money, won’t argue with each other, and produce statements. Most corporate fiduciaries will not serve as your agent under a durable power of attorney for financial decisions or agent under a durable power of attorney for health care decisions. For any one you are considering to serve on your behalf, schedule some time to talk, be specific about your wishes, and ask questions before finalizing your documents with an attorney.

It would take two hands to count the times I’ve heard, “I don’t want to tell Ann/John she/he is my agent because I don’t want she/he interfering or trying to take over.” If you’ve chosen someone you don’t want to tell, you’ve chosen the wrong person. Think about it. The only way your documents are effective is if they are in the hands of those who will use them (or know where to find your documents). Nothing happens between 8am and 5pm, Monday through Friday. It happens at 2am on Tuesday, or Saturday night at 11:30pm. Will there be time to open your safe deposit box or wait for a return phone call to get the documents needed to help YOU?

After you do your planning and follow through with executing your documents, have an open and honest conversation with your family – what your intentions are, how you expect their behavior to be, why you have made the decisions you have. This is not a discussion about money – it’s about your wishes. With those you have chosen to serve, add one important phrase, “It is my/our money and I’ve/we’ve saved it for my/our use first.” Don’t assume your family knows your wishes and how you expect them to act – they don’t.

Should your agent, trustee, successor trustee also be a beneficiary? Your answer should change depending on whether you have the courage to plan ahead. Signing your estate planning documents is instant peace of mind – really – for you and your family.