Question 1: What is a fiduciary?
As part of the estate planning process you will probably have to appoint one or more fiduciaries. A fiduciary is someone who not only has the legal authority to make certain types of decisions for you, but who also has a specific duty imposed upon them by the law. Fiduciaries include your attorney, accountant, financial advisor, real estate agent, and more.
Question 2: What is a fiduciary duty?
When you appoint a fiduciary, the law considers that person no longer just another stranger or average bystander. You cannot force anyone to be a fiduciary, and when someone accepts that role, he or she has a heightened duty under the law. The fiduciary has to do what is in your best interests. If he or she doesn’t, or if he or she uses the fiduciary position to take advantage of you or to pursue his or her own interests, there are specific penalties that apply. In some situations, violating a fiduciary duty can result in criminal charges.
Question 3: Who will I appoint as fiduciary when I make an estate plan?
While there are several people that will have a fiduciary role in your estate plan, and one of the most important is your personal representative. If you are creating a will in Greensboro, North Carolina, you have to appoint an executor, also known as a personal representative, to manage your affairs after you die. Other fiduciaries will include a trustee, healthcare surrogate, and anyone you name as your attorney-in-fact.