By The Confluence Law Center
The Mountain Times
Who will look after your affairs when you are gone? Some of my clients know exactly how they want to distribute their assets, but they are uncertain about who to name as the executor of their will or the trustee of their trust. The decision is critical and sensitive. The person you name to handle your affairs must be willing to take on a burdensome task that is a big time commitment. There are also legal responsibilities for doing the job correctly. Your chosen person could be liable if they don’t observe all the legal requirements of distributing your assets, paying creditors in the right way, and notifying certain parties in the required timeframes. They must act all the while not in their best interest but in the best interest of your estate.
Beyond the legal requirements, you must trust this person with intimate financial and personal relationship information about your life. For some of my clients, their child is the obvious choice. The child has always supported them, is personally responsible, financially stable, and gets along well with other members of the family who have an interest in your estate. For many, however, there is no obvious choice for a person to represent them. If you are in that position, it could be a relief to know that there are professionals whose business is exactly filling the role of trusted representative for you and your estate.
The job title is “professional fiduciary” and in Oregon, professional fiduciaries must be certified by a national organization. As professionals specializing in estate administration, they are bound to the highest ethical standards. They are dispassionate representatives of your estate’s interests and are extremely well-acquainted with the estate administration process. This can be a calming and/or stabilizing influence on family members who might descend into old feuds if it were a relative handling your estate. They can manage assets while you are still alive as well as handling your estate’s financial affairs after you pass. Depending on the company, they can be hired to be your healthcare agent and potential guardian as well.
These services aren’t just for the wealthy. Professional fiduciary services can be personalized for administering estates of modest means. Often smaller, non-institutional professional fiduciaries will charge an hourly rate that applies only when they are acting on your or your estate’s behalf.
They can be a great choice when family relations are strained or there isn’t a person you feel you can trust. Even with trusted people around, consider hiring a professional to avoid imposing rigorous, time-consuming, and demanding duties of estate administration on family or friends. They may thank you for it.
Stories from the Stars
Stephen Sondheim, the acclaimed Broadway lyricist and composer, lived a long and fruitful life. Mentored by Oscar Hammerstein II while still in his youth, Sondheim was the songwriter for “West Side Story” and went on to write and compose many famous musicals including “Sunday in the Park” with George and Sweeney Todd. Stephen Sondheim passed away at the age of 91, the day after Thanksgiving in 2021. To honor the theater giant, a mass “sing-in” of his songs was held in Times Square, led by Broadway stars.
At the time of his passing, his estate was estimated to be worth around $75M. Unlike many stars I’ve featured in these articles, it appears Mr. Sondheim did almost everything right from an estate planning perspective. He had created a revocable trust during his life. He funded the trust with his significant assets and avoided court litigation. Using his trust, he was able to distribute his wealth to more than twenty different personal and charitable beneficiaries. Beneficiaries included his husband Jeffrey Romley and director James Lapine, with whom he collaborated on “Into the Woods”. The Smithsonian, the Library of Congress, and, fittingly, the Dramatists Guild were among the charities that received gifts from his estate.
An interesting fact about Mr. Sondheim’s estate planning touches on the theme of this article. From his will, which was filed in court after his passing, we know that he appointed a professional, his attorney, to be his estate executor. No doubt Mr. Sondheim’s wealth significantly outstrips ours, but the lessons are equally applicable to humbler estates. Creating and funding a trust and naming a professional to administer it are advisable steps for anyone who is planning to pass assets on after their death, eliminating potential for unnecessary friction.