How to Choose a Trustee for Your Living Trust
We meet many people during our lifetimes, but only a few make it into our close circles. If you really begin to think about it, how many of them would you trust with your life on the line? Well, when you’re planning your estate or setting up a living trust in Brooklyn, you will have to decide just that: who can you count on to execute your wishes when you’re no longer there?
Who Is a Trustee?
In a living trust agreement, a trustee is the manager and executor of a trust set up by a granter. The granter adds assets to the trust and holds the trustee responsible for taking care of them for a third-party beneficiary— the eventual receiver of the contents. While you are alive, you can easily modify or revoke the trust agreement. However, in the case of your demise or physical or mental incapacitation, the trustee will make any and all decisions regarding the contents of your trust.
How to Choose a Trustee for a Living Trust?
Make a List of Family & Friends
Instead of choosing someone based on your closeness with them, an estate planning attorney would advise you to go through certain steps. Start off by making a list of potential candidates from family and friends. Write down names that you think will be suitable as trustees; you can always fine-tune the list later. Once you have a rough draft down, you’re ready to think seriously about each candidate.
Check Financial Background and History
Family and friends should be trusted unconditionally, right? Yes, it may sound weird to think of your loved ones as if they were applicants for a job. But this is a big decision for your future and for the future of your beneficiaries and you need to be thorough. It may not influence your decision too heavily, but it can give you a place to start.
For instance, if you are confused between two family friends as trustees, you can take into account their financial habits and management skills. If they manage their own money right, they are likely to have experience. Someone with a professional background in law would do even better! However, you shouldn’t hesitate to pay them a small fee if they have expertise.
If you have named more than beneficiary in your trust documents, the responsibility to divide those assets also lies with the trustee. You should keep this mind when choosing a trustee and ensure that they will act with impartiality when dividing the assets. If your sister is obviously more inclined towards one niece than the other, you have to either be very clear with your instructions or not name her trustee in the first place!
Go for a Professional Trustee
When setting up a living trust in Brooklyn, you can also choose to hire a professional trustee for a fee. Because they are well-educated in estate law, you will not have to worry about the assets not being cared for properly. They would also be free from biases or partiality when dividing assets with no personal vested interest or ulterior motive. However, please make sure to consult with an estate planning attorney to ascertain that you are making the right decision—it’s not the same for everyone!
Can I Name Myself Trustee?
As mentioned earlier, most people choose to be trustees of your own living trusts. Married couples usually own assets jointly and sometimes they can be co-trustees of their trusts. When one spouse passes away or becomes incapacitated, the other becomes responsible for the assets by default without going through lengthy probate. This is why a living trust is preferred over a will.
Can I Add or Remove a Trustee?
In a living trust, you retain the power to modify the trust deed. This includes the power of removal, which allows you to take down a trustee’s name from the agreement for whatever reason. That is why people often go for living trusts when planning their estate—you retain control of your assets.
Before finalizing the trust document, consult with an attorney to make sure you have all the bases covered!