When you set up a trust, you want to pick someone to take care of the trust and the instructions that come with it if you were to become incapacitated or pass away. The great thing about a trust is that action does not have to take place the moment you die. Instead, the trust lives on, and the trustee continues managing the assets associated with the trust.
What are some aspects of a reliable trustee? Let’s take a look at tips for choosing a trustee that will get the job done. You may want someone with adequate financial education and the ability to make necessary decisions during times of stress and grief.
4 Tips for Choosing Your Trustee
You may naturally choose your spouse or next of kin as the trustee. However, if you feel uneasy about that decision or want to look into some required skills before appointing a trustee, check out these 4 tips:
- Ability to Keep Detailed Records: A trustee must keep records of each transaction going in and out of the trust. They must file a tax return each year and report gains and losses. Some individual trustees may not be up to the task.
- Ability to Make Tough Decisions: A time may come when the beneficiary is entering treatment for substance abuse or spending irresponsibly, and the trustee will have complex decisions to make. If the trustee is unwilling to follow through with the rules agreed upon in the trust, they are unsuitable for the job.
- Accountability to Audits and Check-ins: A trustee should be ready to answer questions and provide the proper paperwork when someone asks about where the money went or how investments were made. This documentation and the ability to fulfill requests for information are vital to a trustee’s position.
- Liability If Legal Standards Are Not Met: The trustee will be responsible for any legal shortcomings of the trust. If taxes are not paid, or money goes missing, the trustee should be ready to stand liable.
You do not have to choose your trustee without legal assistance. Shoup Legal is here to help. Contact us at (951) 455-4114 or email us at [email protected] to begin planning today for peace of mind tomorrow.