Who Should Be Your Trustee
By Patricia Louise Nelson of Bend, OR
Often my estate planning clients have an idea about who should serve as the trustee for their revocable living trust. Frequently, that idea turns out to be a very good one. Rather than just noting who is to serve without vetting that selection with my clients, I like to ask my clients some questions to be sure that who they are thinking of appointing will work well.
The first questions have to do with the person who might serve as trustee. Is that person truly, fundamentally trustworthy? If my clients have any hesitation, let’s keep looking for someone they trust. Is that person also someone who can handle the responsibility of serving as trustee? It can be a short-term job or a long-term job, depending on circumstances that we often cannot foresee. Do they have time in their lives to take on this duty? Also, are they a person who can and will say “no” when that is the appropriate answer to a beneficiary’s request for a distribution? Finally, is this person able to handle investing and managing money and other assets? Again, let’s keep looking if there is any hesitation in responding “yes!” to these questions.
Next, how will this person serving as trustee be received by the beneficiaries? If my clients are naming one of their children to serve as trustee, how will the other children feel about that? If my clients are naming one of their siblings to serve as trustee, how will the beneficiaries perceive this choice? Bear in mind that naming Aunt Mary or Uncle Joe can predictably and negatively impact the relationship children have with that aunt or uncle. Not that we can always make everyone happy, but let’s avoid causing foreseeable problems in the family. It might be best to allow Aunt Mary or Uncle Joe to be a loving advocate and sounding board (remember, you’re not there to support them in these ways) rather than putting that beloving aunt or uncle in charge of the beneficiary’s trust fund.
My clients often object that they really don’t have anyone else who can serve as their trustee. This is an understandable feeling. It reflects a limited understanding of the resources available. There are many banks and professional fiduciaries who can serve as your trustee. See our website under helpful links for suggestions. Even though you have to pay a professional to serve (once they are actually serving, but not before), it might be less expensive to do that than to have your trust fund litigation among your beneficiaries and trustee. This sort of litigation is expensive by every measure, especially interpersonally. Let’s avoid damaging your family by carefully considering who will serve as your trustee.
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