How to Select your Trustee
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How to Select your Trustee
A collection of articles, opinions, and other resources on the do's and don'ts of choosing the trustee to administer a family's trust.
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3 reasons not to name family or friends as the family trustee

3 reasons not to name family or friends as the family trustee | How to Select your Trustee | Scoop.it
In the past we educated ourselves on the importance of Wills and Trusts, the importance of these tools when it comes to succession planning and asset protection. Today, I would like to highlight the importance of identifying the right set of trustees.
Daniel P. Felix's insight:

New insights from a different culture which also relies on family trusts.   The Times of India offers three more reasons to hesitate about naming family members or friends as successor trustees:

 

1)   They may be influenced by the other family members.

2)   If your age is close to theirs, that means that they’re likely slowing down just when you may need them to help.

3)   The demands of the trust may exceed their willingness to help.   If trust administration becomes protracted, because the way you created your trust, or because of your disability, your trust may exceed their welcome – and careful attention.

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Trustee selection process enhanced by considering special beneficiaries

Trustee selection process enhanced by considering special beneficiaries | How to Select your Trustee | Scoop.it
The complex and frequently changing requirements of Special Needs Trust administration makes the selection of a corporate trustee especially challenging. A
Chicago Trustee Collaboratory's insight:

The criteria in selecting a professional trustee for a special needs trust is highly applicable to non-special needs trusts as well.  

 

This recent blog echoes some key considerations for any family in the process of selecting a trustee:

 

One consideration is the critical role of the trustee for the success of the family.   The trustee has to be able to engage with the entire team of advisors as well as the family.

 

As part of that, it’s important for the trustee to take the time to get to know the family, the team as well as the documents, the financial situation and the goals.

 

Another consideration:  Experience and skills count, and shouldn’t be taken for granted just because the candidate is a professional.  Attributes to look for include:  general knowledge of trusts and family dynamics, diligence, common sense, and

Independent decision-making.

 

Bottom line:  the family needs to be comfortable with the choice.  The trustee will follow the trials and tribulations of the beneficiary and their family through many ups and downs.

            

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Family Member vs. Independent Professional vs. Corporate Trustee - according to one Trust & Estate Attorney.

Family Member vs. Independent Professional vs. Corporate Trustee - according to one Trust & Estate Attorney. | How to Select your Trustee | Scoop.it
Chicago Trustee Collaboratory's insight:

Alan Orlowsky is well known to me and others in Illinois as a thoughtful and articulate professional.

 

His comments are well taken, especially that the family member should be trained BEFORE taking on the role to trustee.   Most family members don't really understand what's involved, both as to technical requirements and compliance as well as the critical human dynamics elements.

 

I'd add a some warnings and qualifications to Alan's recommendation of considerations of co-trusteeship's, that is, the pairing of a professional with a family member to jointly run the trust.   Generally, I think it may be more appropriate to appoint one, and have the other as a consultant.

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It's About Loyalty, Trust & Common Sense

It's About Loyalty, Trust & Common Sense | How to Select your Trustee | Scoop.it
Serving as the successor Trustee of a Revocable Living Trust, whether due to the Trustmaker's disability or death, is a huge responsibility and time consuming burden, but with the help of your estate planning attorney you should be able to choose...
Daniel P. Felix's insight:

According to their learned lawyer, Julie Garber, it’s all about loyalty, trust and common sense.   The five top qualities you should look for:


1)   Extremely loyal and fair – loyal and fair to both you and your family.

2)   Extremely trustworthy – handling your valuable financial and personal assets.

3)   Practical – it’s not simple or easy, and unforeseen circumstances are the norm.

4)   Organized – balancing budgets, accounts – and people.

5)   Tough – being thick-skinned to deal with the demands of family and corporate red-tape.

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Three Questions to Ask When Choosing a Trustee

Three Questions to Ask When Choosing a Trustee | How to Select your Trustee | Scoop.it
How do you choose a trustee for your trust fund? Here are some considerations.
Chicago Trustee Collaboratory's insight:

Well, it's really six questions, but they do underscore some of the key issues and help advance the discussion.

 

Author Joshua Kennon pulls the first three into one:  Is the candidate capable, qualified and willing to serve as trustee?   This is asking about knowledge and expertise:  legal, financial, as well as trust-related.  It's also asking another good question: whether the candidate has the time and desire to serve.

 

Second, how will the candidate impact family relationships?    Kennon  asks if the candidate will hurt those relationships.  Perhaps the preferred question is whether the candidate will enhance those relationships.

 

Finally, Kennon asks whether the candidate offers continuity and protection against malfeasance.   I'd rephrase this to ask how does the candidate address both continuity and risk management issues.   There are a number of solutions, and one size doesn't fit all.

 

 Kennon closes with his preferred solution of a friend and a bank serving as co-trustees.   My view is cautious, even where that may be the best fit.  For starters: what happens if those two don't agree?  

 

 

 

 

 

 

 

 

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In New Zealand, the same theme - selecting a qualified trustee is difficult!

In New Zealand, the same theme - selecting a qualified trustee is difficult! | How to Select your Trustee | Scoop.it
Timaru Herald
Sorting badly managed trusts
Timaru Herald
I have said previously that by my informal reckoning, about 75 per cent of family trusts are so badly administered that they might not serve the purpose for which they were established.
Chicago Trustee Collaboratory's insight:

On the other side of the world, this financil expert author estimates some 75% of the trusts suffer bad management from untrained trustees.

 

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