In creating a trust, the trustor must appoint a trustee. They can name themselves as the trustee of a revocable living trust and assign a successor trustee who will take over the management of the estate when the trustor passes. With irrevocable trusts or special needs trusts, however, the trustor must name a separate trustee from inception.
What should you consider when choosing a trustee?
Regardless of the kind of trust you decide on, choosing the right trustee will significantly impact the future of your estate and beneficiaries. Your trustee must be able to manage your trust assets without your supervision. Below are some factors worth considering when appointing a trustee:
- You must absolutely trust your trustee to manage your estate with the best interests of your beneficiaries in mind.
- The trustee must be well-versed in financial matters relating to estate tax returns, and, in the case of special needs trusts, they should understand federal benefits programs.
- A trustee’s fiduciary duties can last years; therefore, you should choose a person with the time to manage the daily matters of your estate meticulously.
- The trustee must be competent and organized because they will monitor your trust investments and file annual income tax returns.
- The trustee must also be able to provide the beneficiaries with an annual accounting of the assets and liabilities in the trust, including income and expenses.
The person you trust most is often a family member, but if they are a beneficiary in your trust, there may be points of conflict. Contempt arises with too much familiarity, and legal boundaries can get unclear.
You may want to hire a professional trustee
Connecticut law extensively lists a trustee’s duties, which can be quite confusing for the average person. The trustee’s primary job is to safeguard trust assets for your beneficiaries, which entails a certain level of proficiency and experience.