A trustee is a person or entity who administers a trust. If you utilize a revocable living trust as your assets transfer vehicle, you can act as the trustee while you are alive and well. You can also serve as the beneficiary, so you could receive monetary distributions from the trust throughout your life.
This arrangement is comforting to many people, because you do not surrender control of assets that you convey into a revocable trust. You can also revoke the trust entirely if you ever decide that you want to call the whole thing off and take back direct personal control of the assets that you conveyed into the revocable trust.
You would be creating the trust as an estate planning tool, so you have to account for the things that will take place after you pass away. When you establish the trust declaration, you name a successor trustee to handle the business of the trust after you pass away. Successor beneficiaries would also be named in this document.
A revocable living trust can provide a host of benefits that would not be realized if you were to use a last will as your asset transfer vehicle. First off, assets in a living trust can be distributed outside of probate, so resources can typically into the hands of the beneficiaries a relatively timely manner.
Things are different when a will is used. The will must be admitted to probate, and the administration of the estate is subsequently supervised by the probate court. A simple case may be probated in somewhere in the vicinity of a year, but there are complicated cases that can take considerably longer.
There are those who think that a will is an economical choice, because it costs more to create a living trust. This may be the case, but there are innumerable expenses that present themselves during the probate process when a last will is used.
Avoiding probate is one major benefit, but you can also account for the possibility of latter life incapacitation if you create a living trust. The successor trustee could be empowered to administer the trust if you ever become unable to make sound financial decisions on your own.
Plus, through the inclusion of a spendthrift provision, there would be asset protection for the beneficiaries after your death.
Revocable Trust Trustee
When you think about the appointment of a successor trustee, you may automatically start to consider people that you know personally to assume the role. If you want to go this route, you could do so, but many people have certain concerns.
Longevity would be one of them, and geography is another factor. Plus, it would be logical to name someone who is a family member or a close friend of the family. Under these circumstances, possible favoritism can enter the picture. There can be genuine biases, but even short of this, certain family members could construe favoritism even if it is not really present.
In addition to these factors, you may not know anyone who is ready, willing and able to administer a revocable trust.
You could go in a different direction when you are selecting a successor trustee. The trust departments of banks offer trust administration services, and there are also trust companies that will handle trust administration tasks.
If you go with a professional fiduciary, you gain a number of benefits. There would certainly be no favoritism or conflicts of interest, and longevity would not be an issue. You could utilize a company with offices in your area, so geography would not be an obstacle, and this is another advantage.
Professional fiduciaries are beholden to certain federal regulations, so there is oversight on that score, and there is inherent organizational oversight within the institutions themselves.
There would also be a level of expertise. Assets that you have conveyed into the trust can be intelligently invested by a certified financial professional. If you would like the trust to be able to earn income that can be spread among the beneficiaries over a long-term basis, it would probably be a good idea to put the financial decision-making in the hands of an investment specialist.
Learn More About Revocable Trust Administration
We have provided a foundation of basic information this brief blog post. However, we have prepared a truly comprehensive, in-depth special report that will provide you with added layers of information about trust administration and the role of the trustee.
This report is being offered free of charge right now, and you can click this link to get your copy: Free Trust Administration Report.