Selecting a good successor trustee (or co-trustees) to manage your trust after you die—or, if you’re married, on the last to die of you and your spouse—is one of the most important things you will ever do in connection with your estate planning.
Typically, unless you have a very large estate, you will select one or more of your children, or if you do not have any children, a relative. For a very large estate, you may wish to appoint an institutional trustee, such as a bank.
Being a trustee is a thankless and burdensome task, and the compensation an individual receives is often not worth the on-going headaches – arising from such things as bickering among, and dealing with requests from, beneficiaries, and preparing accountings. So, the individual really needs to view it as a service—a labor of love—he or she is, or they are, providing to your beneficiaries and to the deceased loved one.
It is best that you ask the person(s) you desire to serve as your successor trustee before you die, if he or she is willing to so serve.
Select as your successor trustee a person (or persons) you trust, who is level-headed, who is able to make decisions of a business nature, and who has the ability to get along well with (that is, can “handle”) your beneficiaries. In fact, your selected successor trustee may himself or herself be a beneficiary. This makes it a little easier to justify the tough work ahead.
Sometimes selecting successor co-trustees (to act jointly) is a good idea—especially among siblings—since a brother or sister who was not asked to serve might have hurt feelings from being “left-out.” However, financial institutions may require that in the case you have appointed successor co-trustees, each co-trustee must have so-called “independent authority.” That is, each co-trustee must have power over the account without requiring the approval of the other co-trustee.
Since virtually every situation is different, consider all factors before making your selection.
The above statements are not to be taken as legal advice for the reader’s particular situation.
Richard F. McEntyre practices law in the area of estate planning and administration, having served the San Diego community as a lawyer for over 40 years. Chris von der Lieth is Dick’s associate lawyer, having worked with Dick for over 6 years. Affordable rates. Highest quality services. House calls available. Our office is conveniently located at 2615 Camino Del Rio South, Suite 101 (in Mission Valley just east of Bully’s restaurant) (Telephone (619) 221-0279); www.richardfmcentyre.com.