Professional fiduciaries: what they do and what they cost
The short answer
A professional fiduciary is someone paid to manage money, property or care decisions for another person, as a trustee, executor, agent or court-appointed guardian. Most bill by the hour; trust work is often a percentage of assets. Licensing depends on the state and the role, so check your state's rules.
Maybe the people you'd name are your own age. Maybe they live three time zones away, or you simply don't want to hand them a job this big. So you start wondering who does this work for a living, and what they charge.
That person is usually called a professional fiduciary. A fiduciary is someone legally required to act in your interest and follow what you wrote. This page explains what they do, how they are licensed, how they bill and when hiring one makes sense. It is part of our guide to the four roles in every estate plan.
What does a professional fiduciary do?
A professional fiduciary does that job for a fee, for people who aren't family.
California's licensing agency describes the work well. Its Professional Fiduciaries Bureau regulates conservators and guardians, trustees and personal representatives of an estate. It also covers agents under a durable power of attorney. The services range from daily care, housing and medical needs to bill paying and estate management.
In practice, a professional fiduciary might serve in one of these ways:
- As your trustee. They manage the money and property in your trust, pay what needs paying and follow your instructions for who receives what.
- As your executor. After you die, they settle your estate, which can include probate, final bills, taxes and handing things out.
- As your agent under a power of attorney. They handle money matters, or sometimes health care decisions, while you are living but can't act.
- As a court-appointed guardian or conservator. If you haven't named anyone in advance, a court may appoint one. That path is slower and more public, which is why many people name someone ahead of time.
Here is a typical case, a composite: a retired teacher names her brother as trustee. Her brother is 78 and lives in Arizona. She names a professional fiduciary as backup, so if he can't serve, there's no gap.
How are professional fiduciaries licensed?
It depends on the state and on the role. There is no single national license.
Washington
Washington certifies professional guardians and conservators, not every paid fiduciary. The Certified Professional Guardianship and Conservatorship Board, appointed by the Washington Supreme Court, handles certification, minimum standards of practice, training and discipline.
Who needs certification is set by statute. A professional guardian or conservator is one who isn't a relative and charges fees for the work. The threshold is serving three or more people (RCW 11.130.010).
The court rule behind the Board, GR 23, sets the minimums for individuals:
- At least 21 years old and of sound mind.
- No convictions or findings involving dishonesty, neglect, abuse or physical force.
- Education plus experience. For example, a bachelor's degree and two full years of relevant work, or a high school diploma and five.
- The Board's mandatory certification training.
- Insurance in an amount the Board sets, plus any bond the court requires.
The Washington courts site also has a search for certified professional guardians and conservators.
California
California licenses professional fiduciaries through the Professional Fiduciaries Bureau. The license covers non-family fiduciaries acting as conservators, guardians, trustees, personal representatives and agents under a durable power of attorney. Licensing requires passing an exam and 30 hours of approved education, and renewal requires 15 hours of continuing education each year.
The Bureau's site has a license verification page. Use it before you sign anything.
Other states
Rules elsewhere differ, and some states have no license for this work at all. Trust companies are a separate category: they are chartered as institutions, not licensed as individuals. Our page on corporate vs individual trustees explains that difference.
How do professional fiduciaries charge?
There are two common models.
- By the hour. Many individual fiduciaries bill for their time. Phone calls, bill paying, visits and paperwork all show up on the invoice.
- By percentage of assets. Trust companies acting as trustee often charge a yearly percentage of what's in the trust, with a minimum. Our page on trust company fees shows real published fee schedules.
When a court is involved, the court reviews the fees. In Washington, a guardian is entitled to reasonable compensation, subject to court approval. The court looks at factors such as the necessity and quality of the services and the guardian's experience and skills (RCW 11.130.105).
California works the same way in court cases. Its Rule of Court 7.756 lists factors like the size of the estate and the time spent. It also asks whether the work needed more than ordinary skill. The rule also says it is not authority for a court to set a maximum approved hourly rate.
We haven't found a reliable public source for typical hourly rates, so we won't quote one. Ask each fiduciary for a written fee schedule before you name them.
What to ask before you name one
| Question | Why it matters |
|---|---|
| Are you licensed or certified in my state, and can I verify it? | Lets you check standing and any discipline |
| How do you bill: hourly, percentage or a flat fee? | Tells you what a busy month will cost |
| Do you bill for travel, phone calls and copies? | Small charges add up |
| Who covers for you if you're sick or retire? | An individual can't be on call forever |
| Do you carry insurance or a bond? | Protects the estate if something goes wrong |
| Will you agree to serve as backup, not first? | Many people want family first |
When does a professional fiduciary make sense?
A professional often fits when:
- The people you'd choose are your age or older.
- They live far away and couldn't get to your house in a day.
- Your family would find the job a burden, or a source of tension.
- Your affairs need steady record keeping for years, such as a trust that continues after you.
A professional may not be needed when your affairs are simple and a capable, willing person lives nearby. Even then, naming a professional as backup is common. Our page on naming a backup in every role explains why, and whether your oldest child should be executor covers the family side.
Kinly takes a related approach. Trella Trust Company, a Washington State chartered trust company, can be named in any of the four roles. It can serve first, or as backup to people you choose. If it steps in and does work, that work is billed by the hour, and you see the rates before anything starts.
For a wider look at your options, read choosing professional help, honestly compared.
Common questions
What is the difference between a professional fiduciary and a trust company?
A professional fiduciary is usually an individual or small firm. A trust company is a chartered institution, so its service doesn't depend on any one person staying healthy or in business. Both can serve as trustee or executor where state law allows.
Do professional fiduciaries need a license?
It depends on the state and the role. California licenses professional fiduciaries through its Professional Fiduciaries Bureau. Washington certifies professional guardians and conservators through a Supreme Court board, under GR 23.
How much does a professional fiduciary cost?
Most individual fiduciaries bill by the hour, and trust companies often charge a yearly percentage of assets with a minimum. Rates vary by area and by the work involved. Ask for a written fee schedule before you name anyone.
Can a professional fiduciary be my backup instead of my first choice?
Yes. You can name a family member or friend first and a professional second in each role. If your first choice can't or won't serve, the backup steps in.
Sources
- California Professional Fiduciaries Bureau
- California Professional Fiduciaries Bureau: license verification
- Washington Courts: Certified Professional Guardianship and Conservatorship Board
- Washington Courts: find a certified professional guardian or conservator
- Washington General Rule 23: Rule for certifying professional guardians and conservators
- RCW 11.130.010: Definitions
- RCW 11.130.105: Compensation of guardian or conservator
- California Rules of Court, Rule 7.756: Compensation of conservators and guardians
This page is general information, not legal or financial advice. Laws vary by state.