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
  1751 Hits

Search Blogs Module

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