Avoiding Trustee Tripwires

If you have been appointed the trustee of a trust, this is a strong vote of confidence in your judgment and probity. Unfortunately, it is also a major responsibility.

A trustee should be, first and foremost, a “trustworthy” person. A trustworthy trustee acknowledges the challenges and responsibilities of holding this position. Accordingly, if you are establishing a trust or being asked to engage as trustee under one, then you should give thorough consideration to the attending responsibilities and potential liabilities.

A recent article titled “A Brief Overview of a Trustee's Duties” is worth a look. The article offers eight crucial elements you need to understand and address, specifically: fiduciary responsibility, the trust’s terms, investment standards, distributions, accounting, taxes, delegation, and fees. Essentially, you must fully appreciate that the role of a trustee is jointly moral, legal, and fiduciary.

You have a duty to the beneficiaries, a duty to the language of the trust (the express intent of the trust maker), and a duty to the assets themselves. This duty can be a treacherous tightrope to walk. If you are establishing a trust, understanding this means finding someone who would do as you would do, or better. And if you are a would-be trustee, understanding this means understanding your role and its rewards.

Contact Meier Law Firm to learn more about selecting or being the trustee of a trust.


Reference: ElderLawAnswers.com (May 2012) “A Brief Overview of a Trustee's Duties

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