New York Estate Planning & Elder Law Blog
If you decide to create a trust as part of your estate plan, there are various tasks that you must successfully navigate including appointing a trustee who can oversee the trust. A trustee performs the critical task of both managing the trust and distributing assets in a manner that conforms to the trust’s terms.
While a trustee performs a critical task, many people have misconceptions about the role. For example, some people think that picking a friend or family member to serve as a trustee is a wise idea because it’s a potentially cost-effective option. In reality, there are some distinct benefits to selecting a professional trustee. This article reviews some of the important to consider when deciding whether to select a professional trustee or a loved one to function as a trustee for your trust.
Experience Can Prove Helpful
A friend or loved one might be able to anticipate the emotional hardships associated with trust management, but few understand the legal responsibilities assumed by a trustee. A professional trustee has the knowledge and experience necessary to immediately begin performing in such a role. A professional trustee can also mitigate liability associated with the role. After all, a trustee is fully liable for acts and omissions, which means that a friend or family member who makes an incorrect decision while managing a trust could end up subject to undesirable consequences.
Physical Issues Can Prove Daunting
Functioning as a trustee is a time-consuming task. Trustees discover that the process places a great amount of time and can require trustees to physically be at various locations. A trustee’s role can be made even more challenging if the trustee lives in another area from where the trust’s beneficiaries are located. While a friend or family member might not be prepared for such dedication, a professional trustee almost certainly is.
Family Complexity Can Be Learned
Many people worry that if they retain the assistance of a professional trustee, they are selecting someone who does not know them and their family. Professional trustees make great efforts to understand their clients so they can fully satisfy the creator’s wishes. This means that professional trustees often build strong relationships with families and others impacted by a trust by learning as much about them as possible.
Upfront Costs versus the Cost of Errors
People often worry about not being able to afford a professional trustee. If a family member serving a trustee makes errors while handling the estate, however, these mistakes could end up costing much more than the upfront cost associated with a professional trustee. A balancing test should be performed to decide if it’s more worthwhile to pay a larger upfront cost to obtain a professional fee or to use a family member or friend as a trustee who might end up costing a substantial amount due to an error made while managing the trust.
Contact a Skilled Estate Planning Lawyer
If you or a loved one needs help creating an estate plan that achieves your goals, you should not hesitate to contact a knowledgeable attorney. Schedule a free case evaluation with Ettinger Law Firm today.