A comprehensive estate plan often includes far more than a simple Last Will and Testament. In recent decades, trusts have become a popular addition to even the most simple estate plans. If you are planning to include a family wealth trust in your overall estate plan you will need to make a number of important decisions with regard to the trust, including the choice of a trustee. We are often asked “ Can you be the trustee of my family wealth trust? ” when clients are unsure who to appoint and/or uncomfortable appointing a family member or friend. These concerns are certainly understandable and often well founded.
A family wealth trust is a type of trust used to pass down family wealth. You don’t have to have a fortune to benefit from a family wealth trust; however, they are often used to pass down a family fortune. One of the most important decisions you must make when creating any type of trust is who to appoint as the trustee. The trustee has a wide variety of important duties and responsibilities, including:
Managing trust assets
Investing and growing trust assets
Communicating with beneficiaries
Disbursing trust funds to beneficiaries
Following the terms of the trust
Keeping trust records
Preparing and filing trust taxes
Your trustee can be responsible for the success, or failure, of your family wealth trust, making the choice extremely important. Although you can appoint anyone you wish to be the trustee, appointing a family member or close friend isn’t always the best choice. While a family member or friend may have your best interests at heart, he or she may not have the experience and/or skill set required to successfully fulfill the role of trustee.
A trustee needs to have a variety of skills to properly manage a trust. Your trustee needs to understand the law, must have financial and accounting skills, and be able to handle conflicts or issues that arise with beneficiaries. This often means that appointing a professional to the role of trustee is a better choice. Your estate planning attorney is one option. You may also choose to appoint a professional trustee from a company that specializes in managing trusts.
If you are uncertain who to appoint as the trustee of your family wealth trust, consult with your Missouri estate planning attorney before making a decision.
- How Will You Age in Place and Be Able to Die at Home? - August 16, 2020
- Beneficiary Designations and Other Non-Probate Transfers - August 15, 2020
- Leaving Assets Can Be Tricky – Part 3 - August 13, 2020