The Elder and Disability Law Firm, APC
Common Misconceptions about the Fiduciary Role
There are a lot of terms associated with estate planning. While most are readily understood, one of the most commonly misunderstood terms it the fiduciary. Your fiduciary holds a responsibility under the law. Fiduciaries are required to put your needs above their own - both financially and health-wise. When selecting this person, you may want to consider the following.
Not Everyone is Considered a Fiduciary
Your financial advisor isn't a fiduciary. Your financial advisor simply makes recommendations that are suitable for you, but they don't necessary put your needs in front of their own. In fact, most operate under the legal term "suitability standard," which means they simply advise on what's suitable-whether it helps you or them.
Fiduciary Roles are Hard to Enforce
While someone could be named your fiduciary, enforcing that isn't always easy. It is true that breaking their fiduciary role means they could face criminal and civil penalties, but it can be next to impossible to prove this issue in court. After all, a fiduciary can make the wrong decision, but still have your best interests at heart.
Selecting a Fiduciary
When you select a fiduciary, you should select someone who is organized, responsible and someone you know will follow your wishes. While your friend may be loyal, it isn't always for sure that he will follow your wishes or even look out for your best interests. Since it is hard to prove otherwise, selecting someone you can trust can help ensure your best interests and the interests of your estate, will always be put first.
If you have additional questions on your estate planning, or you have not started the process, consider visiting The Elder and Disability Law Firm for a free consultation today.