When you’re planning for the future, you’ve got a lot of decisions to make, but two of the biggest are:
- Who will receive your property when you pass away
- Who you should name as trustee to handle your estate
The first matter is a highly personal one that only you can address. The second one - choosing a trustee- is also personal, but there are some universal guidelines that can help you make the right decision. This blog highlights the benefits of choosing the right trustee, along with some recommendations for choosing an appropriate one.
Benefits of Choosing the Right Trustee
A trustee can be any individual who is at least 18 years of age and mentally capable. Once this minimum criterion is met, however, other considerations should be taken into account. Your trustee should not have a recent criminal record, especially for fraud-related crimes, or bankruptcy filing. In other words, they shouldn't be tempted to steal from your estate.
Once you identify a person who meets these criteria, you’ll realize the following benefits:
- Reassurance that your estate will be managed and distributed in accordance with your wishes
- A more straightforward estate administration
- Your beneficiaries will receive their inheritances without undue delay
- Should your estate be more complex, you’ll be assured that someone with the right skills and capabilities will be managing it
The Best Trustee Isn’t Always a Family Member
There is a long-standing tradition that trustees be family members, usually the oldest child. However, this eldest child rationale doesn't carry much weight anymore, especially since there’s no guarantee he or she will be suitable for the role.
Trustee work is time-consuming, fraught with liability, and can last for years. Your trustee will manage the assets of your estate and distribute them to the beneficiaries: if your oldest child has a poor money management history, you’ll want to choose practicality over tradition, so that your estate is in the best possible hands.
Who SHOULD Be Your Trustee?
Your estate trustee should have the following qualities: availability, capability, reliability, and financial responsibility.
- Availability: To administer your estate efficiently and without undue expense or inconvenience, the estate trustee should live in the same city as you, or within a close geographical region.
- Capability: A prospective estate trustee should be mentally capable of carrying out his or her duties and be able to identify when professional counsel is necessary (e.g. attorneys, accountants, etc.). Ideally, the person should also be younger than you are, so they are more likely to outlive you.
- Reliability: A prospective estate trustee should be reliable and have some familiarity with the type of assets they will be managing. For example, if your estate includes a business, you want someone who knows how to realize assets, deal with insurance, and make related financial decisions.
- Financial Responsibility: It is important for your trustee to be financially responsible since they will manage and in some cases invest your assets.
No matter who you choose to be your trustee, you should ask permission first. When asked in advance to fulfill this role, people are less likely to refuse, and you have peace of mind knowing that your estate will be well-managed when you pass.
Questions? Speak to an Estate Planning Lawyer
Naming a trustee is only one of the many steps involved in creating an estate plan. Mannor Law Group is an estate planning & elder law firm that helps clients prepare for a time when they will no longer be around to provide for their loved ones financially. For more information about our services or to schedule a consultation, call (810) 645-8426.