Choosing a Trustee

One of the most difficult tasks in the estate planning process is the selection of a trustee.  In a revocable living trust the initial Trustee(s) is the person who established the Trust (the Settlor).  This is often not the case with an irrevocable trust.  But whether it is the initial trustee of an irrevocable trust or the successor trustee of a revocable living trust there are certain characteristics that should be considered:1.  Judgment:  Is the Trustee aware of his/her own capabilities and weaknesses. If the Trustee does not have accounting or investment experience, would he/she have the judgment to admit this and engage an appropriate qualified professional?2.  Availability/Location: Does this Trustee have the time required to be a Trustee?  Is living near the beneficiary or Trust assets important?3.  Longevity: How long will the Trustee be needed? Someone near the Settlor's age may not live long enough to fulfill the job.4.  Impartiality:  Is the Trustee capable of being impartial among the beneficiaries. This is especially difficult to do if the Trustee is one of the beneficiaries.5.  Interpersonal Skills: The Trustee must be able to communicate well and effectively to the beneficiaries and to professionals who may be involved with the Trust.  A good Trustee will need to be able to work calmly and well with all involved.6.  Attention to Detail:  While it may not happen, the Trustee should assume he/she will be sued at some point and keep meticulous records as a ready defense. A Trustee who expects to be sued will be much better prepared than one who doesn't think it will happen and, as a result, does not take the record keeping requirement seriously.I always say a bad Trustee can ruin a great Trust.  Paying attention to these characteristics will help you increase the likelihood that your plan will succeed without litigation or worse, potentially permanent damage to family relationships.

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2012 Exemption Announced