A Revocable Living Trust, often called a “Living Trust,” can be a beneficial estate planning tool for a variety of reasons. Often, a person will create a Trust when they no longer wish to manage their assets themselves or they want to minimize the possibility of post-death disputes over their assets.
Part of creating a Trust is choosing a responsible Trustee who will act as a fiduciary and serve in an administrative role for the Trust’s assets. This person will ensure that (1) assets are used for the benefit of the person who created the Trust for as long as he or she is still living, and (2) assets are distributed appropriately after the Trust creator’s death.
Deciding who will serve as Trustee is a critical decision. Should you choose an individual, such as your spouse, another family member, or a friend? Or should you choose a trusted professional like a bank, brokerage, or trust company? In our experience, most clients look to individuals they know first and only enlist professionals if they do not have family members or friends who are up to the task.
Top Four Questions to Ask a Potential Trustee
Often, close family members or friends come to mind when it’s necessary to choose someone for a fiduciary role like serving as a Trustee. If you’re thinking about asking someone to serve as your Trustee, here are the top four questions to ask them.
- Are You Available and Willing to Serve as Trustee? Trustee duties require a time commitment, so potential candidates must have the willingness and availability to serve in this role. They will need to determine what needs to be done and carry out their duties following appropriate timelines.
- Can I Count on You to be Responsible? Trustees must display honesty and trustworthiness beyond any doubt. They also must have the ability to communicate clearly and resolve conflicts. You want to choose someone who can confidently take the reins when called to action.
- Are You Capable of Handling Complicated Financial Decisions? A potential Trustee needs to be able to handle financial and economic issues wisely and without becoming overwhelmed. You don’t want someone who is irresponsible with money or who may take imprudent risks with the assets you’re asking them to manage.
- Are You Willing to Enlist Professional Help if You Need It? The Trustee should know when to hire professionals, such as investment advisors, lawyers, and CPAs, when dealing with issues they are not fully equipped to address alone. Choosing a corporate fiduciary can be the best solution if the Trustee needs support to carry out their fiduciary duties.
Morgan & DiSalvo has years of experience helping clients in the Atlanta area understand their estate planning options. To request further information or to schedule a meeting with us to review your current fiduciary choices, please call (678) 720-0750 or email info@MorganDiSalvo.com.