When putting together your Living Trust estate plan, you will be asked to name a Successor Trustee. During your lifetime, you serve as the Trustee of your own trust. You control all of your assets as usual, but should something happen to you and you are no longer able to serve (such as become incapacitated or pass away), whomever you have named as Successor Trustee will step in.
Deciding on who should be your Successor Trustee can be difficult for some. Here are some tips on deciding who should serve as your Successor Trustee.
Things to Consider When Choosing a Successor Trustee
When you name someone as a Successor Trustee, you are effectively giving them power to manage your trust properly if and when you are no longer able to. Therefore, it is important that when you are considering options for a Successor Trustee that you consider whether this person (or persons) has good common sense and is someone that you have a great deal of trust to handle these important matters. While they don’t necessarily need to be the most experienced on the financial end, it is important that you choose someone that is dependable and who will be organized, honest, and take the time to ensure that he or she does what they are supposed to. Most Successor Trustees will have the ability to seek out professional help, such as from a CPA, financial advisor, and attorney, where necessary.
Choosing Multiple Trustees to Serve at the Same Time
Many people opt to choose their children to serve as Successor Trustee and those with multiple children will often times choose all of their children to serve. While only choosing one child when there are multiple can bring about a multitude of conflicts, so can naming all of them to act and serve as Co-Trustees together can also bring a great deal of conflict. If they do not agree about the way something should be handled or managed, it may be required that all have to come into some form of agreement to act or they may be able to act independently. Either way, both situations can create a lot of unnecessary conflict and this usually comes at a very difficult time for the surviving children to manage on top of the emotional grief that comes from losing a parent.
Who Else Can I Name as Successor Trustee?
Other than your own adult children, you may have a close friend or relative that could be a great fit to serve as your Successor Trustee. If you have any minor children or children with special needs, your Successor Trustee may have to be responsible for managing a trust for the care of your children for a long time. Again, it would be important to find someone that you trust completely, who is dependable and honest, and someone that is willing to take on such a task.
If you do not have someone in mind or aren’t sure about who to choose, another option to consider is choosing a corporate trustee. A corporate trustee is typically a bank trust department or a trust company that can perform the duties of a trustee. They can either serve as sole trustee or can also be named co-trustee with someone else that you may name. While there is an expense that comes in choosing a corporate trustee to manage your estate, it often times makes the most sense to ensure that things are properly handled and to avoid any potential conflicts that may arise by choosing individuals in your family or circle of friends to take on this very important role.
Have you set up your estate plan yet? If not, we can help. And, if so, we encourage you to get your estate plan reviewed-including a review of whom you’ve named as Successor Trustee and whether or not that choice still makes the most sense.
If you are in the Los Angeles or Orange Counties of Southern California, we welcome you attend one of our upcoming free Living Trust Seminars to learn more about our law firm-the Law Firm of Kavesh, Minor & Otis. We have been servicing the estate planning needs for over 37 years. We even have a plain-English guide to assist you and your Successor Trustee when the time comes-our unique Successor Trustee Manual. You can find out more by attending our seminar. To register online, rclick here or contact our main office at 1-800-756-5596. If you are unable to attend an upcoming seminar, please feel free to join our e-mail list and we will be sure to e-mail you of future seminar dates.