On April 13, in a post titled, "Creating a trust and selecting a trustee," we gave a brief summary of some ways that a trust and well-appointed trustee can help in estate planning and administration. Now, more specifically, some sources recommend considering some key elements of estate planning before determining who will be selected as the trustee of one's estate. Maryland residents taking the time to plan for the future typically want to be sure that their wishes, assets and family are protected, which is why it is crucial that the process of establishing a trust and trustee is organized and successful.
One of the first things that is recommended to be considered before a trustee is appointed is the value and nature of the estate. Some sources recommend that estates valued at above $50,000 be managed by a professional, while estates of lower value may be more easily managed by a loved one or trusted friend. Because many corporations charge fees for fulfilling the duties of a trustee, smaller estates may benefit from a personal trustee.
Personal trustees can be friends, family members, or business associates. Because these personal relationships were held and nourished during one's life, those individuals may be more inclined to be a successful trustee. Nevertheless, the process of managing an estate can be challenging, and personal trustees always have the option of seeking professional support.
When there are multiple beneficiaries, a trustee's role may become even more complicated. The relationship between beneficiaries should be considered before appointing a trustee. If there is already tension between family members, or if there has been more than one marriage, an objective third party may be a valuable support tool to keep the situation under control.
Maryland residents in the process of estate planning may already be aware that tensions can mount when it comes to discussing assets and who gets what. While either a personal or professional can act as a trustee individually, a well-rounded estate planning team may help ensure that everything is in place and geared for success. Establishing a trust is but one way that Maryland residents can ensure that their assets will ultimately be distributed in accordance with their wishes.
Source: The Wall Street Journal, "Naming a Trustee Is a Key Estate-Planning Decision," Jeanine Skowronski, Sept. 10, 2012