Revocable living trusts have become a widely used estate planning document, providing a way to manage assets, avoid probate, and gain confidentiality when settling an estate. When working with your legal advisor to establish a revocable living trust, you typically appoint yourself as a trustee and manage your financial assets as you have done before. It is necessary to appoint a successor trustee, to act in the event of incapacity or death. Choosing the right trustee is one of the most important decisions you will make.
Special care should be taken when choosing someone to fill this often complicated and difficult role. Family members may not have the experience, capacity and time required to perform the duties of a trustee. Individuals often have personal relationships with beneficiaries which can cause conflict within the family. While you can choose almost any adult, including family members or friends, consider a corporate or professional trustee as the best possible solution.
Experience and dedication
Trustees pay full-time attention to the assets of the trust. They have experience, resources, access to tax, legal and investment knowledge that can be difficult for an individual to replicate. A corporate trustee can be engaged as an administrative trustee only, allowing them to focus on the operation of the trust, while engaging your registered investment advisor to manage the investment assets. Alternatively, the company trustee can be engaged as both an administrative trustee and an investment manager. Flexible trust language may allow beneficiaries and co-trustees to continue working with your current registered investment advisor or allow them to identify a registered investment advisory firm of their choice.