A fiduciary is entrusted to manage your financial and/or healthcare affairs. Financial affairs often include management of cash in bank accounts, securities in investment portfolios, retirement funds, real estate, rentals, and business interests. Healthcare affairs can include advocating for a client who has lost his or her memory, or ability to communicate. Sometime clients are in the extremely vulnerable and dependent process of dying. The fiduciary’s duty to his or her client requires the utmost of loyalty. Professional fiduciaries are specifically trained in the art and science of guiding clients, and ultimately making decisions for clients, without any personal bias, and do so while steadfastly protecting and honoring the client’s wishes.
Many people select a friend or family member to act as their fiduciary. While this may work for some, there are many reasons to choose a professional fiduciary.
- Professional fiduciaries are heavily regulated and held to certain fiduciary standards in order to ensure that your finances are secure and protected. A professional fiduciary is required to adhere to policies that prevent your funds from being misappropriated, co-mingled, or poorly managed.
- Professional fiduciaries must maintain an insurance policy to protect clients.
- Professional fiduciaries are focused on correctly handling your finances in accordance with sensible, prudent policies and standards.
- Professional fiduciaries have the knowledge and the means to work cooperatively with your accountant, attorney, investment advisor, insurance and real estate agents, medical providers and other professionals you rely on for assistance with legal, financial and healthcare matters. Professional fiduciaries understand federal and state laws governing their work and services as fiduciaries.
- Professional fiduciaries will never make a decision regarding your finances or healthcare from a place of self-interest or greed. Although we like to think that the same is true of our family members and friends, the lack of regulations and training for non-professional fiduciaries can result in tragic financial, personal, and family dramas.
- In summary, the benefits of choosing a professional fiduciary over a friend or family member to administer your financial and healthcare affairs are akin to the benefits of choosing a professional attorney over a friend or family member to represent you in court.