During your lifetime you (and your spouse) typically remain in control of your trust assets and live just as if the trust did not exist at all; you remain in control of your assets with full discretion on their use and your enjoyment. But after you die or resign as trustee there needs to be someone else to assume the office of trustee or else the trust will fail and your estate plans may be frustrated.
It is essential to choose a successor trustee that you trust and that you believe is capable of doing the job. Capability means that an individual has both the experience and the time to perform the duties of a trustee. You might trust your very successful friend to be your trustee but if she is also very busy then the duties of a trustee could be an unwelcome burden. If the nomination as successor trustee is a significant hardship, that individual might refuse the appointment and the office would pass to the next in line.
There is no formal legal or financial expertise required for a trustee but you should select someone who is responsible in meeting deadlines, who can understand basic finance and also someone who is willing to follow instructions. Keep in mind that you won’t be around to provide clarification or explanation to your successor trustee, so the person you nominate must be willing to read and understand the instructions you have given to the best of her ability. You should give instructions to your successor trustee to seek out and hire competent professionals to assist the trustee in performing her duties. We don’t expect trustees to become tax and financial experts upon appointment but we do have certain standards for duties owed to beneficiaries, and experts can help the trustee to fulfill these duties.
If you cannot find a person willing and able to serve as your successor trustee, you may want to consider hiring a corporate trustee. Having an entity act as the trustee can relieve stress in knowing that an experienced party will handle the necessary trust functions and avoid problems related to a conflict of interest or inter-family disputes. This decision can be even more important if you anticipate that there will be a challenge to the estate and/or trust by one of the heirs.
If you have questions about picking a successor trustee, a knowledgeable trust and estate planning attorney is available for a complimentary consultation at Nielsen Law Group to provide answers and practical solutions. You can schedule your initial consultation by calling (480) 888-7111 or submitting a web request here.