If you’re reading this article, I think it’s safe to assume that you either (1) have an estate plan already or (2) are aiming to create one soon. So first of all, good work! You’re ahead of the pack and years from now, you’ll be so glad you took the time to prepare for your financial future. However, you now need to make a critical decision: who will you name as your Trustee? Learning how to choose a Trustee for your estate can be stressful, but this is a monumentally important decision. If you make a misstep now, all of your hard work will have been for nothing. To choose someone worthy of the title Trustee and also capable of completing the associated responsibilities, please scroll down for some helpful tips.
How to Choose a Trustee for Your Estate
- The Trustee must be responsible. A Trustee‘s responsibilities can be extensive and last for a while. Your Trustee may need to collect assets, pay taxes and bills, file accountings, and manage money for beneficiaries. Choose someone who can confidently complete the tasks and exercise the powers you assign them in your trust, will, or power of attorney.
- The Trustee should be comfortable with the beneficiaries. If the Trustee will be consulting with beneficiaries, managing money for them, and discussing financial issues, it’s smart to choose someone who your beneficiaries are comfortable with. Are there any conflicts of interest? Does your preferred Trustee have any longstanding grudges against a beneficiary? Note: if the beneficiary is also named Trustee, this will obviously not be a concern.
- The Trustee must be trustworthy. Whether you choose a family member, a friend, or a professional, you need to find someone you can trust. Especially if large sums of money or valuable assets are involved, honesty is integral. If you’re wary of letting someone you know handle these responsibilities, hire a professional (like an attorney or bank). If you’d prefer to save money and use someone with whom you’re familiar, choose a loyal family member or friend.
- The Trustee must be sensible and have integrity. Use your common sense. Who do you know that has good business sense? Who can make decisions with good judgment and fairness? Who acknowledges when they need help and asks for advice? Who is responsible enough for record-keeping duties, including handling statements, receipts, disbursements, and long-term records? Also, if this is applicable to your situation, who understands investing and financial management?
- The Trustee should be healthy and willing. Your Trustee needs to outlive you, so be prudent and don’t choose your older brother or your mother. This person should be younger than you and in good health. You want them to administer your estate years from now, after all. Finally, your preferred candidate should be ready and willing to serve as Trustee (and even if they are willing, be sure to name a successor Trustee as well, just in case).
Before you make any rash decisions, discuss your plan with an attorney experienced in elder law and estate planning. They can answer any further questions you might have, including inquiries about co-Trustees and corporate Trustees. If you need help creating your estate plan and you live in southwest Missouri, contact the attorneys at Parks & Jones. We would be happy to help you build or update your estate plan. Give us a call at 417-823-9898 or click here to schedule a free consultation.