If you’ve added a trust to your estate planning package, your next step will be choosing the ideal trustee to handle your assets and distribute them to your beneficiaries. This individual will also be responsible for managing and administering the details of your trust, taking care to honor your wishes at every turn. Therefore, it’s crucial to choose wisely. Consider the guide below to discover the characteristics of an ideal candidate.
What Traits to Look for in Your Trustee
1. Organized & Meticulous
Trustees will face a number of complicated fiduciary tasks like filing an annual income tax return for the estate. They’ll also need to keep track of any continuing income from the estate, gains and losses related to the trust, and funds being held for beneficiaries in the future — for instance, after your child graduates from college. If the estate needs to pay household employees, they’ll also need to manage employment taxes. Therefore, it’s important that the trustee you choose has a reliable track record for being meticulous and attentive, keeping files organized, and filling out forms accurately and on time.
Once you’re no longer around to manage your estate, your trustee will do their best to follow your instructions in managing your trust. However, issues may arise in which they’ll have to use their own judgement and make difficult decisions. For example, if one of your beneficiaries is dealing with a gambling addiction, they may need to withhold your beneficiary's inheritance until they can receive help. For some close friends and family members, it can be difficult to be this discerning and do what’s best for the trust. That’s why it’s important to choose an individual or legal professional that can make unbiased, objective, and firm choices when necessary.
Of course, you’ll also need to consider the practical side of being a trustee, as it's important for the individual you have in mind to have time to perform the role. Trustees take on a considerable amount of work, from filling out paperwork to consulting with beneficiaries. They’ll need to respond to beneficiary concerns and questions with urgency. They’ll also need to meet with accountants, attorneys, and other professionals to manage the assets in your trust. That’s why it’s important not to select individuals with busy work schedules, a tendency to travel abroad, or multiple young children. You should also choose a successor trustee to take over if the original falls ill, passes away, or is otherwise unavailable.
If you have additional questions about choosing the right trustee, reach out to the estate planning professionals at Wills and Trusts Hawaii. They serve clients throughout Oahu, giving them peace of mind and ensuring their estates and loved ones are looked after. They will help you through every step of the estate planning process, from designating beneficiaries to avoiding probate. To learn more about their services, visit the website, or call (808) 792-8777 to speak with a representative.