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Which Child to Choose as Trustee?
Answer: The one who gave you the most trouble growing up. Being trustee of a family trust is a difficult, thankless job and it will be a great way to extract payback. On a serious note, sometimes a family member can work out as trustee. Often, however, it is not only difficult, but it can hurt family relationships.
WHY USE A PROFESSIONAL TRUSTEE?
Trustees may have to make tough decisions that might not be popular with all your beneficiaries. After all, the trustee is carrying out your instructions, not your beneficiaries’ wishes. This can be a difficult role to fulfill for a family member, who may not be objective or may wish to act in a manner that avoids hard feelings within the family, rather than carrying out your instructions. Also, few family members have investment management skills or expertise in fiduciary law and practice. Family members can be given important advisory roles, such as in approving disbursements or other exercises of discretion. The Benefits of Naming a Professional Trustee Include:
- Objective loyalty and independence to carry out your wishes
- Knowledgeable management, protection, and defense of trust assets
- Experienced oversight of the investment process to be carried out by your financial advisor
- Timely and accurate statements of the account to keep you and all current beneficiaries informed
- Consistent annual reviews
- Accountable collection and prudent distribution of income and assets
- Tax reporting, filing, and comprehensive regulatory compliance on behalf of the trust
- Trust Administration: Serving as Trustee or Co-Trustee
The trust administration role is central to carrying out your wishes regarding the use of assets in the trust. The trustee carries out your directions and follows your guidelines in handling the specific circumstances of each request for funds from trust beneficiaries. This involves legal interpretation of the language in the document and appropriate input from family members, as well as conformance with appropriate and applicable state trust codes. Experienced and objective trust administration is a vital component of implementing your plan.
Trust Settlement Services
Trust settlement is the process of settling an estate through a trust, either in addition to or rather than a will. Your financial advisor can lead you through the process along side the expertise of a Professional Trustee. We are committed to helping deliver administrative trust services in a seamless manner—helping you maintain and strengthen your financial picture and transfer assets at death to the ones that mean the most.
Agent for Individual Trustee
Individual trustees can retain complete control over a trust and simply outsource many administrative duties to a Professional Trustee. It’s often viewed as an honor to serve as trustee of a trust established by a loved one or friend. However, quite often the administrative duties can be time consuming, overwhelming, or burdensome. A Professional Trustee can assist an individual trustee by serving as agent for trustee. With the trustee maintaining complete control over investment management and discretionary distribution responsibilities, they can provide review of the trust agreement and assets, trust accounting, distribution activity, transaction reporting, investment monitoring, and tax services (including the preparation of appropriate tax returns and all of the trust administration in compliance with complex state and federal laws). They can also provide any required accountings to be filed with local courts, regular maintenance and execution of scheduled or recurring payments as authorized or directed, and assistance with the proper determination of income or principal characteristics for transactions paid as stipulated in the trust agreement or state law.
A Professional Trustee can bring a high-caliber and experienced team, providing customized “family office” and wealth strategies for the specialized needs of high-net-worth and ultra-high-net-worth families, privately held and family businesses, and family foundations. In addition to traditional trust administration and oversight of investment management, some offer family office services to assist families by assuming much of the day-to-day management of a family’s affairs, including discussing your tax, estate, and philanthropic planning, bill paying, family member financial education, and family governance.
Custody and Escrow Services
The custodial role is that of a financial secretary and security guard. Certain Trustee identify and take title to the trust’s assets, keeps accurate records, reports to the current beneficiaries, and executes and settles all transactions.
The financial professionals at Personal Financial Group do not provide legal advice nor can act as a trustee on a trust. We suggest that you speak with a legal advisor about your individual situation before taking any action. The information provided is for educational purposes only and not intended to provide specific advice or recommendations for any individual.