If your estate plan includes a trust, one of the most important decisions you will make is who the trustee (or trustees) should be. If the trust is one which will give the trustee(s) discretion about how much money to give the beneficiaries — and under what circumstances — then choosing the trustee may be the second-most important decision you ever make regarding the trust, after choosing the beneficiaries. The trustee(s) will be standing in for you, managing and distributing the assets you have accumulated during your life after you are gone.
If you set up a trust during your lifetime, you yourself can be the trustee, but you will still need a successor trustee in the event you become incapacitated or otherwise unable to serve as trustee during your life, and for after your death. Obviously, if you set a trust up in your will, the trustee will be serving after you are gone.
While there are a number of common mistakes made in choosing trustees, a qualified New York estate planning lawyer can help you avoid making them.
How should I choose between a corporate trustee, a personal friend and an adult child as trustees?
Depending on the size of the trust, trust management may require sophisticated financial skills. However, New York law permits a trustee to delegate those duties to a professional investment manager. In contrast, a professional trust company will be familiar with their legal duties and obligations, but they may not know you, your family, and their needs. Making one of your children a trustee for the benefit of your other children and grandchildren may seem like a way of keeping it all in the family, but it will dramatically change the relationships between the children. Indeed, it may present such acute conflicts that the child declines to serve or the relationships between the children deteriorate.
How many trustees should I have and how old should the trustee be?
Having one trustee is typically simpler, but that person will have a great deal of responsibility.
In thinking about choosing a mature, responsible trustee, we often consider picking a person our own age (perhaps a lifelong family friend) or even older. But what are the chances that this person may be well enough to serve after your own death?
Choosing an initial trustee — and successor trustees for as long as a trust is likely to last — are very important decisions for those whose estate plans include trusts. An experienced New York estate planning attorney can help you determine if a trust is right for you, and help you select appropriate trustees.