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How To Select A Trustee For Your Trust Or Executor For Your Will

  • By: Christopher Benson
  • Published: March 9, 2014

The right trustee can make a big difference in the way your estate is handled. So how do you choose one, and more importantly, how do you make sure they are living up to their responsibilities when you won’t be around to check up on them?

There is also the common concern of “hurting someone’s feelings” by not selecting a particular person. That is a valid feeling; however, sometimes you have to put feelings aside and use logic and common sense.

A common question I am asked is: “Can we appoint co-trustees?” A common situation is where you have two children and you don’t want to hurt anyone’s feelings so you are thinking about putting them both in charge.

The answer is “Yes” you can. But, it is typically not a good idea. We recommend against appoint Co-Trustees for numerous reasons. You also can go stand in the middle of the freeway at night wearing dark clothes…but…that typically is not a good idea either.

1. The Co-Trustees would have to agree on every decision. Initially, you may think this is a “good thing” because it forces them to discuss everything. But, the reality is that it creates more problems than it solves. The reason is that people are different and often times in the administration of a trust or probate estate, there can be multiple valid methods to accomplish the stated goal. If the Co-Trustees don’t agree, that leads to a “dead-lock vote” and the estate can not make progress in the administration.

What if one of your appointed trustees doesn’t “feel” like talking? Well, nothing gets done.

What if one of your appointed trustee doesn’t “feel” like working on the administration of the estate? Well, once again, nothing gets done.

Selecting one person (or 3) that have the final decision making authority is the best way to avoid conflict and pave the way for smooth administration of your estate with minimal problems. Selecting 3 people to administer your estate also works. At least in that situation it avoids dead-locks but it does make the administration of the estate more cumbersome.

2. Whomever you appoint as trustee and/or executor of your estate have to sign everything. This requirement can make the administration cumbersome, slow down the process and add to the expense. If real estate is involved, the Co-Trustee have to sign all the sales documents, amendments, agree on the course of negotiations, sign all the closing documents etc. If the Co-Trustee do not live close to each other, this factor adds to the problem

3. Having Co-Trustee can add to the administration expense of the estate and thus result is less financial wealth being transferred to your intended beneficiaries. it’s the old joke “How many Trustee’s does it take to screw in a light bulb?” Why appoint multiple people to handle the same job?

At the end of the day, it is your decision. If you want to designate Co-Trustees and/or Co-Executors….then fine. You can do that. However, my advice is to be pragmatic about the decision and make your best choice. The reality is that the real “gift” you are making is to your intended beneficiaries. Designating a trustee or executor is not a “gift.” You are appointing them to do a “job.”

4. There are several clauses that can be written into a will that help govern the actions of a trustee and protect your interests.

  • Guardian/Trustee Appointment Clause. This clause can be written into a will when there are minor children involved. The guardian portion of the clause indicates who will take over care of your children, and the trustee clause directs how funds will be used for their care. They can be the same person, but they don’t have to be. The same person you would trust to raise your children may not be the best when it comes to financial matters, and the opposite could be true as well.
  • Guardianship/Trustee Protection Clause. These are the rules of the road for your trustee. This clause will state the parameters of the job and standards of performance. It also will outline under what circumstances your trustee should be removed and replaced.
  • Accounting clause. The accounting clause is where you can identify what the trustee should have to report on. This could include profits, losses and funds released to beneficiaries. 

It’s important to choose a trustee who is level-headed, has a track record of making good decisions, and someone you trust with your family and your family’s affairs. If your trust doesn’t provide compensation for this role, you should make sure they have their own reliable source of income.

Over the past 32 years, the Law Offices of Christopher A. Benson has helped more than 800 clients prepare and utilize simple and effective planning techniques to protect them and their families in order to avoid probate, save estate taxes, save money and save added emotional burden that comes from long term illness and/or death of a family member. Give us a call to schedule a free consultation to find out how we can help you and your family.

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