When creating a trust, many people choose to be the trustee of the trust until they die. In the alternative, selecting someone to be the trustee requires careful thought. Similarly, selecting a successor trustee is an essential aspect of creating a trust. They are responsible for managing assets held in trust upon your death and distributing them to beneficiaries according to your instructions.
Whether you’re selecting a trustee or a successor trustee, you can appoint anyone at least 18 years old and of sound mind. It can be your parent, child, friend, or coworker. However, they must be someone you trust to fulfill your wishes and their duties.
Below are factors you should consider while determining who should manage your trust.
Pick Someone with the Ability to Handle the Responsibility
The person you choose should be trustworthy. They’re handling your money so appointing a trustee you know won’t mishandle your assets or steal from your beneficiaries is crucial.
However, that’s not the only attribute they should have. They must also be organized and responsible. Managing a trust requires more than distributing assets to named beneficiaries. The successor trustee must also manage your investments, pay bills, and handle other financial duties. Having someone who can juggle multiple tasks correctly and efficiently will ensure nothing falls through the cracks.
Think About Whether Appointing Co-Trustees Is an Option
You can name co-trustees for your trust. This arrangement allows two or more people to manage your trust. The burden won’t fall on only one person. Multiple individuals you appoint can share the duties and work together on distributing assets and closing the account.
However, picking co-trustees who will work well together is critical. You shouldn’t appoint siblings or other relatives if they always fight. That can cause issues and might lead to legal disputes.
Decide if You Want a Local Trustee
Your trustee doesn’t have to live in the same state as you. You can pick someone who lives in another state or country. However, consider whether that will affect their role somehow.
If they live in a different time zone than your designated beneficiaries, it can create communication challenges. Learning about and following the rules for distributing assets in another state can also be confusing.
Consider Your Financial Agent
The responsibilities of a trustee and appointed agent for a power of attorney can overlap. You might benefit from picking your power of attorney agent to also handle your trust. They have the legal authority to manage various financial aspects of your estate, including filing taxes, paying bills, and accessing accounts to cover emergency expenses, such as medical treatment.
Picking your financial agent to oversee your trust might make the most sense. They’re already familiar with your finances and know how you want your assets managed and distributed.
Name a Professional You Already Use for Other Affairs
You don’t have to appoint a family member or friend as your trustee. Designating a professional or corporate trustee, such as a bank or financial advisor, can work to your advantage. They already have the experience and skills to manage assets.
You might already have an ongoing relationship with that professional and trust them to perform the job correctly. Unlike your loved ones, they’re not biased or emotionally involved in your financial affairs. That allows them to handle your assets without questioning your instructions.
You should not appoint a trustee without considering all options and determining what suits your needs most. Choosing someone you trust can give you peace of mind and help ensure your family’s financial future.
If you need help creating a trust, call The Law Offices of Stephanie Hon at (512) 888-9378 for a free 15-minute call with an estate planning lawyer in Cedar Park, TX, today.
921 W. New Hope Dr. Suite 104
Cedar Park, TX 78613