A comprehensive estate plan may include a Trust, Will, Durable Power of Attorney, HIPAA Authorization, Healthcare Power of Attorney, and Funeral Representative Designation, among other legal planning tools. The person or entity you authorize to act in each of these various parts of your plan are those upon whom you will rely on to take care of you, your loved ones, and your possessions in time of your incapacity and following your death. It is important that you understand these various roles and choose these helpers you name carefully.

Trustee—A trustee manages the assets placed in a trust for the benefit of the named beneficiaries. In a typical Revocable Living Trust, you are the initial trustee and beneficiary. If you become incapacitated due to an accident, illness, or aging, your trust names a Successor Trustee who will manage the trust assets for your benefit. After you pass away, the named Successor Trustee will manage and distribute the trust assets for the next named beneficiaries. With a properly funded trust, the costs, delays, and complexities of probate can be avoided.

Trust Director — Your trust may authorize a Trust Director, a person who could be appointed to make administrative types of adjustments to your trust in circumstances where there is a need for adjustment, such as a shift in the law regarding benefits, protections, or tax implications of the current trust, at a time when you cannot be involved because of incapacity. Without the Trust Director provisions, it would be necessary to involve the probate court to attempt to make such adjustments.

Disability Panel — Your trust may authorize a Disability Panel as a means to determine when a current-acting Trustee is no longer able to act as a result of age, illness, disability or incapacity. A determination by the panel authorizes the next-named trustee to efficiently step in and assume management of the trust.

Personal Representative — Your Will nominates a person or entity to act as Personal Representative if your Will is probated. The Personal Representative is given the responsibility to initiate the probate process, transfer assets to your Living Trust, and to close out the probate proceedings. Your Personal Representative is typically the person or entity that you have chosen to act as your Successor Trustee in your Trust. If you do not have a Trust, your Personal Representative is authorized to liquidate your assets, pay your final bills, and distribute assets according to your Will .

Guardian — Your Will may perform a very important additional function. If when you die you have children who are still minors or under a disability, the Will should name a guardian that a court will appoint to take care of your children. You should carefully name the guardian, considering who you trust to step into your shoes as parent and raise your children in a way similar to how you would have.

Attorney in Fact — In Michigan, the agent named in your Durable Power of Attorney is called an Attorney in Fact.  This individual, often a trusted family member or friend, and typically the same person you name as Successor Trustee in your trust, is granted the authority to make financial decisions on your behalf if you become incapacitated and to manage any assets and financial matters that are outside of your trust. This helper is also typically authorized to transfer property to your Revocable Living Trust, to make withdrawals from your retirement assets, and to manage your life insurance policies.

Authorized Recipient under HIPAA — The Health Insurance Portability and Accountability Act (HIPAA) are federal regulations designed to protect your medical information. The Authorized Recipients in a HIPAA Authorization are those persons you authorize to obtain your protected health information on your behalf, perhaps just to be informed of your condition after an accident or during an illness, or in order to make informed decisions about your care and to pay your medical bills.

Patient Advocate — Your Patient Advocate is the agent you name in your Healthcare Power of Attorney to make medical decisions for you if you cannot express your wishes or make the decisions yourself.  Your Healthcare Power of Attorney should authorize your Patient Advocate to do everything from authorizing simple procedures all the way up to announcing your wishes regarding life support. Your Patient Advocate should be someone you know and trust to act according to your wishes and who you believe will act calmly under what could be stressful situations. 

Funeral Representative — In Michigan, you may designate a Funeral Representative who you wish to act on your behalf with the funeral home after your death. The Funeral Representative will interact with the funeral home for everything from simply transporting your body to making funeral arrangements and directing the disposition of your remains. Without the Funeral Representative Designation, Michigan requires your next of kin to act together in these regards. At a time of mourning and stress, it can prove difficult to obtain consensus and cooperation among all required participants.

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Understanding these key roles is crucial when creating your estate plan. Each serves a specific purpose in protecting your interests and ensuring your wishes are carried out.

Estate planning is about more than just distributing assets. It’s about safeguarding your well-being and ensuring your legacy is preserved. By understanding the roles of various helpers in your estate plan, you can take proactive steps to protect your interests and the well-being of your loved ones.

Schedule time with us to let us review your current plan or to help you establish a plan. We can help guide you through the process of choosing the appropriate helpers and creating a comprehensive estate plan.