Choosing a Trustee – What is Important?

A trust can be an invaluable addition to a comprehensive estate plan. In fact, after a Last Will and Testament, trusts are often the second choice for anyone creating an estate plan. A trust can help you avoid probate, decrease your estate tax burden, and even allow you to retain a certain degree of control over your assets long after your death. When you create a trust, one of the most important decisions you must make is who to appoint as the trustee. Although it is a highly individual decision, consider the answers to the following questions when you are considering a potential trustee:

  1. Does he/she have a personal stake in the outcome of any trust business?
  2. Does he/she live close to the majority of the trust property?
  3. Does he/she have the time needed to administer the trust?
  4. Does your prospective trustee have any experience as a trustee?
  5. Does he or she have a background in finance or law?
  6. Will he/she be able to be fair and impartial?
  7. Does he/she have the resources to act as trustee?
  8. Is your prospective trustee willing to serve in the position?

Basic questions such as these can assist you in determining whether or not the person you have in mind is really a good fit for the position. Depending on the complexity and value of your trust, you may also wish to consider a professional, neutral trustee such as a bank, an attorney or a professional trust management firm.