Making sure that your estate planning documents are implemented as early as possible is extremely important. One of the biggest challenges that clients encounter during the process is deciding who to appoint as their trustees, powers of attorney, health care surrogates and executors.
Below are some practical tips to help guide you in your decision making.
1. Give preference to those who have the most time to devote and live nearby
Lots of my clients have very accomplished children who are successful business owners, professionals or leaders in their trade or occupation. The most successful people might not always be the best choice since these individuals sometimes run tighter schedules and have less time to devote to helping you with your affairs than others. In addition, maybe certain children have more kids and other obligations than others. This is important to take into account.
Additionally, give preference to people who are closer in proximity to you. It is certainly easier for them in terms of being your power of attorney and health care surrogate. However, being nearby can matter less for trustees and executors.
2. Do not make arbitrary designations
Another mistake I see a lot is selecting an individual based on arbitrary characteristics. You see this a lot when someone appoints a particular child just because they are the oldest. Perhaps there is one son or daughter, and they appoint that person based on gender.
Selecting an agent is very important. There are a lot of factors to consider, but you should not select individuals based on these arbitrary factors.
3. Avoid naming multiple agents, when possible
A lot of my clients want to make sure none of their children feels left out, so they want to appoint all their children to every position possible. This, more often than not, leads to deadlock or discourse once decisive action is necessary.
For example, I had a client who recently came back to me to change his documents after he had appointed his three children all as co-agents and trustees. He realized that such action would lead to great disagreement among them, and as a result, timely action would be difficult. Three “Type A” personalities made it hard for them to agree, as each of them wanted to lead.
Therefore, avoid multiple agents when you can, unless you are sure everything will run smoothly.
4. Pick the best agent for today
I counsel a fair number of younger clients and clients without children. They always have the most difficulty because the answer as to who will be their agent is certainly not as …….