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Choosing the Right Trustee

A trustee is appointed to manage a trust for the benefit of the trust beneficiaries. It is an important role and one with numerous duties that must be seen for the trust to properly operate and fulfill its purpose. A trustee, for instance, will be responsible for all trust accounts and property held within the trust. Property held in trust can range from securities and other financial accounts to real property. Furthermore, the trustee possesses the sole legal authority to sign for all assets held in the trust as well as the responsibility to do the trust banking and pay the bills of the trust. The trustee is responsible for making appropriate distributions from the trust to trust beneficiaries according to the terms of the trust. Failure to fulfill these obligations and uphold the duties of a fiduciary can result in the trustee being exposed to personal liability as well as jeopardize the trust itself. This is why it is so important to choose the right trustee.

Choosing the Right Trustee

A settlor establishes a trust and transfers assets into the trust to be managed by the trustee. A trust may be established for a number of reasons and there can be great benefits from adding a trust to your estate plan. To help ensure the proper management and functioning of your trust, choosing the right trustee will be important and the selection should be approached thoughtfully as well as with care.

The only restrictions the law places on your selection of trustee is that the trustee must be legally competent. This means that the trustee must be at least 18 years of age or older. The trustee must also be of sound mind. This means that the trustee has the ability to manage their own affairs. Other than these two requirements, you have fairly broad discretion in who you choose as trustee. You could appoint a family member, a friend, or a professional trust company to manage your trust.

Just be sure that you are selecting a trustee who will take seriously the role of trustee. Choose someone who, in your estimation, is trustworthy and responsible. The trustee will be tasked with overseeing the execution of your trust and will be instrumental in seeing your wishes properly carried out. Choose someone who will not take this responsibility lightly.

While a trustee need not possess any particular expertise in the law or financial realm, familiarity or some knowledge base in these areas can be helpful to a trustee because of the nature of the role. Depending on the type of trust you plan on establishing, you may want a trustee who is familiar with other things. For instance, it can be helpful for the trustee of a special needs trust to understand federal benefits programs as well as how a special needs trust can potentially impact a beneficiary’s continued qualification for such programs.

Minnesota Estate Planning Attorney

At Unique Estate Law, we are here to help you make sound choices as you work through the estate planning process. Contact us today.