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How to Choose the Best Trustee for Your Estate

How to Choose the Best Trustee for Your Estate

Choosing the trustee is one of the toughest decisions you have to make for your estate plan. The designation of the trustee to manage your estate when you are gone is a significant decision. While the trustee’s duties will vary depending on the type of trust created and any specific stipulations included in the trust documentation, they will be in charge of overseeing your assets and the assets of your loved ones. In most cases, the trustee is a friend, a family member, a professional trustee, a lawyer or accountant, or a trust company. It is a crucial role, and there are several considerations to be made.

Are There Certain Traits A Trustee Should Have?

The person designated as a trustee should be trustworthy. If you don’t trust them to hold a stack of cash for you, they shouldn’t be named as your trustee. It’s usually a good idea to skip past anyone who lives paycheck-to-paycheck or someone with a high-risk income (such as day-trading).

The individual you choose as your trustee should understand financial matters and be good with money in a general sense. At the very least, they should be familiar with basic investing concepts, and in a best-case scenario, they would have assets of their own and work with their own investment advisor. Your trustee, in most cases, needs to be both smart enough to take good care of the estate and intelligent enough to know they should turn to an investment advisor to invest trust assets.

Choosing a friend or family member as a trustee generally means there is a certain level of trust and familiarity, which is beneficial because they will have a better understanding of family dynamics. It also often means there won’t be a charge for handling the duties of a trustee. (Family members are just as entitled to charge a trustee fee as anyone else, but they don’t always do so).

Choosing a professional trustee, trust company, or attorney as trustee may be a better option even though it will come with associated fees. They bring expertise with trust administration. Going with a professional also avoids resentment amongst friends and family who disagree with your choice of trustee and resentment if the “family member” designated as trustee does (or does not) take a fee for their services.

Fulfilling the duties of a trustee can be a lot of work. If you designate a family member as trustee, and they do not charge a fee, they may resent all the work they are required to provide for free. From a different perspective, if you designate a family member as trustee and they charge a standard fee to fulfill trust duties, your children may be bothered that the trustee gets paid from “their” money.

A professional trustee, trust company, or attorney also offers the benefit of a little bit of “distance” from the family and any associated drama. When the trustee is a family member, they can get sucked into family drama or even enjoy their new role as the one in “control” of your beneficiaries’ finances. The professional trustee will not be as familiar with your family or your beneficiaries in most cases. Still, they will be more likely to see your beneficiaries objectively and treat them fairly and equally.

If you need assistance deciding who to designate as your trustee, get in touch with the experienced Florida estate planning attorneys at Elder Solutions Law Firm, PA today. Don’t put off finalizing your estate planning documents because you can’t decide who to name as trustee. We can discuss the issue with you and help you address your concerns and find the best solution for you and your family.