Seven Considerations for Choosing a Trustee

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Picking a trustee is daunting, even for wealthy clients. Since trustees control everything, the decision is crucial.

Let’s imagine you are embarking on a two-week voyage across rigorous waters. Before you start, you get to choose the captain of the ship. Here are your options:

  • Captain 1: Took a three-hour course on how to steer a boat and just received their license this morning.
  • Captain 2: Does not have a license, is a family friend and you haven’t been on a boat with them before.
  • Captain 3: 15 years of professional ship captain experience and has traveled around the world five times.

For grantors and beneficiaries of a trust, they can choose the captain of their ship. However, picking a captain/trustee is not a time for fun and excitement. The trust document plays a crucial role in outlining what can and cannot be done.

Here are two very important things to look for and/or include inside your trust document:

  • Language to remove and appoint a trustee
  • Ability to change the governing law

There are many reasons to why having this specific language is important. If your trustee is doing an egregious job, you want the option to make a change. Specific language like this offers beneficiaries control and choices.

A trustee’s job is to follow the rules outlined in the trust document. This job gives the trustee a lot of power, such as how much and when assets are distributed, investments inside the trust, complex accounting, and following the administration rules of the document.