Executor… Agent… Trustee… What are all these things???

Trustee… Executor… Agent…  POA… Will… Trust…

When you have a Trust based estate plan you end up having a number of legal documents that accomplish different tasks; are usable at different times and the people who might act under them have different titles.

For your Trust – it is effective immediately – throughout your life & after your death. The person who has the “power” or authority to manage the assets in the trust is called the Trustee.

You should have a Will. A will has no effect until the day you die. When you have a Trust based plan the will should be a Pour-Over Will – or a safety net to the Trust. The person who can act under the will after your death is usually called the Executor.

You should have a Power of Attorney. A POA is ONLY usable in your lifetime – it dies when you die. The person who can act under this document is usually called the Agent – sometimes your Attorney In Fact…

Generally speaking when you have a Trust based Estate Plan you need to title the bulk of your non-tax deferred assets into the name of your trust and once you have done that it will always be whoever is acting as your Trustee who can do things with those assets – ie, sell them, change them, invest them.

Typically you are your own Trustee until the day you die or become incapacitated. Every once in awhile you might put someone else in charge right away or you might decide to resign and let someone else take over. But up until that point for all your assets in your trust – you as your own trustee are the only person who can manage those trust assets.

You should have a Durable Power of Attorney for Financial Matters. This document is only effective during your lifetime and the person nominated under that document is called your agent.

Your agent can handle all your NON Trust Assets and Debts.

Generally speaking your Agent under your Durable Power of Attorney has no legal authority to manage or take care of any assets titled in the name of your trust. To have that be the case BOTH documents must be specifically drafted to allow that.

Understanding these differences and ensuring your assets are properly titled is an important part of making sure your estate plan will work for you the way you will need it to when you need it and avoid frustration on your and your successor’s behalf.

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