A trust is a common tool used to protect assets or distribute property upon death. While there are multiple types of trusts that can serve many purposes, a common element of all trusts is the naming of a trustee.
The trustee is responsible for managing trust assets and carrying out instructions of the trust. As a result, it is important to carefully consider who to appoint as trustee.
Qualities to look for
As the name “trustee” suggests, trust is a critically important factor in selecting a trustee. Mistakes or misconduct can significantly diminish a trust’s value, so a trustee should be somebody you trust to act responsibly and in good faith.
You also want a trustee who possesses the knowledge and ability to fulfill their duties. The exact qualifications depend on the nature and complexity of the trust, but in all cases, you want somebody with common sense and good judgment.
Ensuring the trustee is willing and able to perform the duties is another consideration. Managing a trust may require considerable time and energy. You want to ensure the trustee understands the commitment and is willing to undertake it.
A trustee should also have good communication skills, especially if there are multiple beneficiaries of the trust. Lack of communication can breed mistrust, so a trustee should be able to maintain transparency and open communication with all interested parties.
For more complex trusts, it may be appropriate to retain the services of an attorney or financial advisor to act as trustee. In other cases, a willing and trusted relative may be the best choice.
Establishing a trust
If you are considering establishing or modifying a trust, it is important to consult with an experienced attorney. An attorney can advise on selecting the most appropriate trustee and assist in drafting and executing documents necessary to establish the trust.