Asset Planning, Inc Blog

The latest from the team.

The Importance of Choosing the Right Trustee

 

More and more people are realizing the importance of setting up a trust for their estate. Having a trust in place insures that your wishes for your estate are carried out on your terms if you become unable to care for yourself or pass away. It also prevents your assets from going into probate after your death and saves a huge headache for your heirs. While having a trust in place is very important it is also very important who you name as the trustee.

There are a few different options when selecting a trustee. The most common scenario is that a married couple sets up a living trust where they are both listed as trustees and they list a child or family member to become the successor trustee. In the case that one spouse passes before the other the living spouse will become the sole trustee until they are incapable of caring for themselves or they pass away. At that point the successor trustee in charge of handling the estate duties.

The responsibilities of managing an estate are many and can be daunting to someone who lacks experience in these types of situations. When choosing your trustee you should choose someone who is (a) willing to dedicate the time and energy to run the estate (b) responsible and possesses good judgement and (c) someone who can be objective when following the instructions set up in the trust. It may seem like the natural choice to choose your child or a family member to act in this role but it may not be the best choice depending on the complexity of your estate and their abilities.

In the case where a person is unsure of who to name as a trustee an estate attorney will usually suggest that a bank be set up as the trustee to carry out the responsibilities of the trust. This is called a corporate trustee. This seems like a good idea because a bank has experience with handling trusts and wealth management. But this is not always the best choice either. When the duties of a trustee are needed the bank will take over the trust, move your assets from whatever accounts you have them set up in now to investments of their choosing and will take over the estate. They will follow the instructions in the estate as wished but it may leave your family without the feeling of a personal connection since they may not have worked with that bank before or know the person handling the assets.

Did you know that you have another option that will help ease the burden on your loved ones by running the estate themselves? There is something called an administrative trustee. In a lot of cases we see a child take over the duties of the estate and get overwhelmed with the process. They may be doing it free of charge but in the long run trying to take care of everything on their own ends up costing more financially and emotionally. An administrative trustee is a company that is set up to handle all of the time consuming paperwork and filing responsibilities of the estate. They do not make any decisions as far as wealth management is concerned. That is still the responsibility of the trustee and their financial advisor. Yes, there is a fee to have an administrative trustee but it can outweigh the stress and headaches that come along with trying to do everything yourself.

The best thing to do is have an open discussion with your family, estate attorney and financial advisor. Make your goals and wishes for the estate clear and set up the trustee that you think will be the best fit for your personal situation. By doing this you will have the peace of mind knowing that your wishes will be followed and that your family will be taken care of in the way that you want.

Continue reading
  1438 Hits
1438 Hits

Search Blogs Module

Wait a minute, while we are rendering the calendar
July 6 February 14 increase Open Enrollment Roth IRA Treasury Department news coverage house sitter spring cleaning stimulus package California Lions Friends Facebook profile Ice Cream Social stock pile credit monitoring service years partner /owner contribution limit settlement options 2018 IRA contributions executive order Retirement Contribution Limits coronavirus illiegal robocallers disaster areas credit card company Expired medications Auto insurance retirement breach July weekend 23 andme 900 number operations manager Asset Planning pets holidays approach Shred paperwork EEChecklist-Kits.pdf stockpilingchecklist.pdf vision screening asset Planning Legal robocalls cell phones records earthquake app information Facebook clients DNA test kits phishing scams markets items spam phone family members memorial Day weekend official certification jury duty Supplemental Security Income Part B “ skimmer ”. toilet paper check lists Medicare Part B information Charles Schwab phone companies Healthcare tax filing deadlines IRA accounts earnings fallout Fox News story banking privacy settings estate donation items paper records Medicare Advantage cell phone service provider Mobile Banking Security Tips health care costs business hours padlock pet retirement planning parking spots borrowing money president Trump cell phone SIM swap scam offering insurance tax returns CA FTB FSA April 18 2017. 401K Medicare tax records Orange County credit score September 8 home break-ins web address rescue organizations non-prescripstion sunglasses prescription eyeglasses Wells Fargo employees tax deadlines Coronavirus Aid retirement plans insurance policy 70 1/2. January 10 app VOIP landline phones relief efforts April 11 scams credit card fraud vacation trust team members Puerto Rico phishing sites documents interest rates ice cream event 20 year anniversary water … tax deadline media accounts payments IRS CFP ® checklists https :// fun atmosphere July 3 rd Two-Step Verification Medicare Part B premiums Affordable Care Act April 15 birth certificates Kraig Mathias 2017 IRA contributions account numbers insurance policies emergency kit tax season TD Ameritrade clients show support home mortgages emergency kits student loans Independence Day Medicare question gap insurance home emergency kit home security Joey Gonzales Victor Dergunov fees emergency folder June 29 Brexit vote FEMA website 2017 TD Ameritrade National LINC Conference Notary Public Medicare plan blog post credit cards identity thieves https ://seekingalpha health care services consumer spending text messages Economic Security bottom line notary services client portal self-help topics cell phone carriers email notifications policy home emergency preparedness kits drive /usb Part D premiums . assets cell phone provider Financial Planning Magazine Erin Nelsen fun facts interest Orange County Superior Court card reader money September 9 pet donation drive Federal Trade Commission website people medications identity theft investment statements September 30 2020. pet supplies home market turmoil estate planning direction 4 pm -8pm 2017 Equifax breach ID card paperwork clutter donation counts Social Security Administration Amazon phone CERTIFIED FINANCIAL PLANNER exam debt pet industry opt-out integral member Social Security cell phone carriers offer Labor Day CARES Act chip-enabled EMV cards Open House National Ice Cream month privacy notices portal July 4 COVID -19 virus Wells Fargo customers flash drive life saver estate planning Kiplinger Letter summer car loans credit freeze October 1 2020. company wells Fargo hurricane Dorian ice cream retirement accounts clone counterfeits trustee driver license IRS deadline D premiums spread Flexible Spending Account