Frequently Asked Questions
Q
What is a Professional Fiduciary?
Professional Fiduciaries are entrusted to provide financial and healthcare options that ensure their client’s dignity and peace of mind. They provide the experience, resources and knowledge to oversee services like paying bills, legal, investment management, medical care, housing, and nutrition, among other things.
Professional Fiduciaries are licensed and regulated by the State of California and must follow a strict code of ethics. One must take courses required by the licensing bureau, pass a lengthy exam, attend continuing education, have a clean background check and be bondable.
Additionally, they are strictly bound by the California Probate Code and ultimately answer to the Court even if the matter is not court supervised. Professional Fiduciaries are ultimately responsible for the actions of anyone they hire to assist with managing a client’s needs such as investment companies or realtors. The Professional Fiduciary may be surcharged by the court for client losses resulting from improper management.
A professional fiduciary is one in whom legally has been placed the utmost of confidence to manage and protect the personal affairs, property or assets of the client as well as to help ensure their mental and physical wellbeing. The roots of overseeing the finances and well-being of another dates back thousands of years and is found both historically and currently in cultures around the world. Today, with specialized training, licensing, ongoing education and expert resources, the Professional Fiduciary is someone that you, your loved ones, the courts and other professionals entrust to safeguard your interests and desired quality of life. A professional fiduciary’s services can include anything from basic financial management, personal representative, probate trustee, trusteeship, conservatorship, and guardianship.
Q
Who do Professional Fiduciaries serve?
Professional Fiduciaries serve seniors, people with mental and physical disabilities and children who do not have a family member with the skills or proximity to manage and protect their money and/or healthcare need before and/or after they die, and who do not have the knowledge or ability to manage these affairs themselves.
Additionally, they manage Special Needs Trusts for developmentally and mentally disabled individuals and are also guardians of children.
For people with potentially difficult family dynamics, a Professional Fiduciary can serve as an independent third party to keep their clients safe and to protect their assets.
Q
What would you use a Professional Fiduciary for?
There are a number of different types of Professional Fiduciary relationships. Each comes with unique duties and responsibilities for the person who requires representation (usually known as the principal, ward or beneficiary).
There are many benefits to hiring a Professional Fiduciary. A Professional Fiduciary has the knowledge and resources to help manage an estate, financial affairs, and a special needs trust. These are often complicated matters and require experience and expertise. One can have peace of mind that matters are being handled in a skilled and ethical way. Hiring a Professional Fiduciary can also help minimize family drama and preserve relationships among siblings and relatives.
Q
When would you use a Professional Fiduciary?
There are several common situations when someone may choose to hire a Professional Fiduciary. When doing advanced estate planning, a person with full mental capacity may name a private fiduciary to oversee health care or manage finances in the event of future incapacity. This may include naming the fiduciary as Power of Attorney for finance, the power of attorney for an Advanced Healthcare Directive and be named in trusts as the successor trustee who steps in after the person passes away.
A Professional Fiduciary can oversee the health care and/or finances of someone with impaired mental capacity, such as an elder with Alzheimer’s that did not do advanced estate planning. Family members may agree on a Licensed Professional Fiduciary to act as a court appointed conservator over their elder’s person and estate. And a Professional Fiduciary can be bonded where most family members cannot.
In the case where the elder named children as co-trustees in the event of incapacity, and the children disagree over care and financial matters, they may choose to hire a Professional Fiduciary to take over in an oversight role, or a court may intervene and appoint a Professional Fiduciary. In blended families with children from different marriages, an elder may choose to name a Licensed Professional Fiduciary to ensure their wishes will be fulfilled after they are gone, knowing having a neutral person step in will aid with family harmony.
A Professional Fiduciary may be needed in situations of what is called “undue influence” where someone with significant financial resources needs the impartiality of a Professional Fiduciary to make decisions on his/her behalf because of evidence that family members (or an appointed agent) may misuse or take advantage of access to the person’s finances.
Q
How is a Conservator appointed?
Anyone who believes a person may need help with daily living activities and/or finances can initiate the process to appoint a fiduciary as a conservator. The concerned person may contact a fiduciary of choice to investigate the situation. If the fiduciary identifies sufficient need, he or she will retain an attorney to petition the probate court for appointment as conservator.
Q
How is the Conservatee protected?
The probate court often appoints an attorney to represent the alleged incapacitated person. A court investigator is also appointed by the court to determine the need for a conservator and to recommend a suitable person to serve in that role. All issues and information are brought before a probate court judge who decides if the person is incapacitated or in need of protection and, accordingly, appoints a conservator. The appointed fiduciary is accountable to the court for his or her work. The fiduciary must report to the court and receive the court's approval in carrying out his or her responsibilities. The court requires the posting of a surety bond by the conservator, which is intended to protect the assets of the conservatee's estate.