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Trust Law Partners Blog

We understand how complicated it can be to navigate trust disputes. Our blog is designed to give you the information needed to better understand how to protect your interests as trustees.

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Who Should Be the Trustee of My Trust?

If you are planning on what will happen to your money and property after you die, you may be considering setting up a trust. It’s a sound choice as it will prevent your beneficiaries from going to probate court. However, you will want to be very careful when choosing a trustee. A California Trust Attorney can help you make the best decision for you and your family.

Understanding Trusts: The Basics of Estate Planning

A trust is a legal way to manage property, money, and other assets for the benefit of a beneficiary or beneficiaries. If you create the trust and put property into it, you are the settlor. You can either have a revocable living trust or an irrevocable living trust. An irrevocable living trust cannot be changed without the consent of everyone named in the trust. A revocable trust offers more flexibility in adding or subtracting assets, or in changing beneficiaries.

The Role of a Trustee in Managing Your Trust

A trustee can be anyone including you, an attorney, a bank, or someone else you trust. The trustee will have responsibilities and powers as set out in the trust document, as long as they don’t conflict with California law. The main responsibility of the trustee is to collect, protect, and preserve the assets in the trust. The trustee’s duties include, but are not limited to:

  • Making prudent investments
  • Making sure the property is insured
  • Keeping the property in good repair
  • Paying bills and expenses
  • Managing tax filings
  • Selling assets
  • Distributing payments to the beneficiaries

Being a trustee is a serious undertaking and you don’t want to name the wrong person as trustee, so getting legal advice with this decision is critical.

Factors to Consider When Choosing a Trustee

Being a trustee is a big responsibility, so you want to make the right choice. The trustee has a fiduciary duty to be honest and trustworthy and a person of good character is an obvious choice. It is beneficial if the trustee has a solid background in making financial decisions and possibly property management. If you choose a family member to be the trustee, it might strain the relationship and sometimes you may have to remove or even sue the trustee which does not make Thanksgiving a pleasant holiday!

When the settlor dies, the trustee is responsible for reporting the death to all beneficiaries and then carrying out additional responsibilities required by law which usually includes notifying creditors, government entities and social services, among others. Additionally, the trustee will have to marshal and inventory the assets of the estate and plan to pay debts and taxes as well.

Appointing a bank or a trust company as the trustee is a wise choice as they have the expertise to manage the trust without personal feelings and can administer the trust in a neutral capacity without family issues clouding its judgement. There will be charges associated with using a bank as a trustee but in the long run, they can eliminate a lot of headaches associated with using inexperienced family members that are not familiar with the duties of being a trustee.

Why You Need Expert Advice

The death of a family member is not only emotionally exhausting, but it can also be an administrative maze of regulations, court rules and financial pitfalls. Most nonprofessional trustees are serving in this role for the first time in their lives and it is a confusing and often frustrating experience that can be avoided by using a professional who is well versed in the tasks needed to properly administer an estate.

Contact the legal team at Trust Law Partners today for a FREE consultation to learn how we can help you.