One of the most important decisions made when establishing a trust is the selection of a trustee. Choosing the wrong trustee can lead to legal issues and be disruptive to estate-planning goals, so it’s essential to consider options carefully.
A trust is a legal arrangement that transfers property to a trustee, who manages it for the beneficiaries named in the trust. The law sets high standards that every trustee must meet. With a living trust, the grantor typically functions as a trustee. But who will take on this responsibility should the grantor or trustee become disabled or die?
Some grantors choose a family member or trusted friend. Another option to consider is a corporate fiduciary as a trustee. Choosing a Corporate Trustee can help ensure that current and future generations benefit from the expertise, prudence and continuity that a well-established fiduciary can provide.
Advantages of a Corporate Trustee
Objectivity: Trustees must be able to stand up to the pressures exerted by beneficiaries, without concern about how this might affect family relationships. A Corporate Trustee is only concerned with managing the trust to its exact specifications.
Continuity: Individual trustees can resign, become disabled or pass away. A Corporate Trustee remains in place as long as the trust employs it.
Accounting and reporting expertise: Accounting and reporting for a trust is complex. A Corporate Trustee has the operating systems and expertise to properly manage these functions.
Willingness to Serve: It’s important not to assume an individual will take on the responsibility of serving as trustee-always ask first. A Corporate Trustee is ready and willing to serve (after all, it’s our job).