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Choosing a Trustee for Your Estate Plan: 7 Questions to Ask

Posted by Seton McAndrews | CFP®, Vice President Investments
May 19, 2014

Choosing_a_Trustee_for_Estate_Plan.pngChoosing a trustee is one of the most important decisions you’ll make if your estate plan includes one or more trusts. After you've reviewed your estate planning strategy, but before you appoint a trustee, it's important to evaluate whether or not the trustee can handle the duties of administration. 

Trustee (noun): A trustee is responsible for understanding and interpreting trust terms, distributing income and principle to the beneficiaries of the trust according to the guidelines set forth by you, preparing trust accountings, and filing tax returns – all while adhering to state and federal laws regarding appropriate standards of care.

In other words, a trustee has control or powers of administration of your property and/or money in trust. For reasons that should be very clear, this means that you need to know how to choose a trustee that you trust, and that the person or entity is qualified to handle the duties.

7 Questions to Ask Before Choosing a Trustee

1) Does the trustee have the experience and knowledge necessary to perform the above services to fulfill fiduciary responsibilities?

2) Will they be able to make objective decisions to administer the trust as you intended, while treating beneficiaries fairly and impartially?

3) Did the trustee ask to review your estate planning strategy and your goals and objectives for the family?

4) Can the trustee provide continuity in administration of the trust, keeping up with changing laws and spanning multiple generations if necessary?

5) Can they administer the trust in the most tax efficient way possible?

6) Will they be accessible whenever your beneficiaries have a request, question, or need? What kind of service will the trustee provide?

7) Is the cost of hiring this trustee competitive relative to the industry, and relative to the services and experience provided?

Whether choosing corporate trustee services or enlisting an individual (like a friend or family member) to administer your trust, it is important to carefully consider the responsibilities that come with it. Answering each question above as thoroughly as possible is a great way to get started.

WrapManager as Your Soundboard

One of our Certified Financial Planners can help you ask the right questions as you form your estate planning strategies. We can also review your entire financial situation and recommend what trust or estate planning services could make sense for you given your circumstances and objectives. Give us a call today at 1-800-541-7774 to get started.

Estate Planning