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3 important considerations when choosing the right trustee

On Behalf of | Mar 16, 2023 | Estate Planning

There are many reasons that people choose to add a trust to their estate plans. One of the biggest benefits is having a trustee oversee the management and distribution of trust resources. A trustee, who may receive compensation for their services in some cases, will take care of the property included in the trust and distribute it as appropriate to beneficiaries.

They will have a fiduciary duty to the beneficiaries to act in the best interest of the trust, often by maximizing the value of the resources that fund it whenever possible. Choosing the right trustee is crucial to ensuring the proper administration of a trust. How does one select an appropriate trustee?

Consider personal histories

Often, the people someone considers for the role of trustee will be their closest friends and family members. Occasionally, it may be a professional that they know personally and trust.

When naming a specific individual to serve as trustee, their personal history of making ethical choices and of handling stress well will be key considerations. Trustees are in a position where they could do significant damage to someone’s resources through incompetence or greed. Selecting someone who has the organizational skills and commitment necessary to fulfill the duties of a trustee will also be very important.

In some cases, people may choose to name two or more people to serve as co-trustees. Other times, when there does not seem to be a suitable candidate among their inner circles, individuals may choose to arrange for a professional trustee who will handle trust obligations in a professional capacity and can therefore arrange for the descent of such duties indefinitely.

Discuss the choice with top candidates

Serving as trustee often involves a lot of work, even if there is some degree of compensation for the services rendered. A trustee does not automatically have to accept their obligations, so it will be important to pick someone who is willing to serve that role in addition to being capable of doing so. Occasionally, testators may actually need to go back and revisit their trust to change their trustee arrangements when family circumstances change.

Thinking carefully about the major decisions involved in trust creation and seeking legal guidance proactively can both help testators better protect themselves and their loved ones.