I’ve decided I need a trust. Now what?
Knowing you have a reason for a trust is half the battle, but there’s still work to be done.
Finding a good estate planning attorney is necessary. However, before you set that appointment, it’s always best to have an idea of what you want to accomplish with the trust.
If you’re currently acting as your own trustee, who will succeed you at your death? People often name their surviving spouse to act as trustee at their death, but they will need another trustee to carry out the terms when the surviving spouse has passed.
Maybe you have multiple children and aren’t comfortable naming just one as trustee or don’t want the difficulty that could come from naming all three jointly. In either case, a bank with a well-established trust department can be named as a corporate trustee.
When choosing a corporate trustee you’ll want to consider the fees they charge.
One corporate trustee may charge more than another, so be sure to compare apples to apples. The less expensive corporate trustee may not provide a personal trust officer to work with your beneficiaries after your death. If you want personalized attention for your beneficiaries, make sure that’s included in the fee your trust will pay.
In addition to choosing an estate-planning attorney and a trustee, you’ll need to choose beneficiaries of the trust. This decision can include multiple elements because you may have several individuals or charities you wish to give to, with some receiving greater shares than others.
Another important element is determining when the trust will distribute out – immediately at your death, at the death of your spouse, or over several years to your beneficiaries.
If you have beneficiaries that aren’t responsible or good with money, or are too young to receive your assets outright, consider leaving the assets in trust for a certain period of time. You can set up the trust so beneficiaries receive distributions within the trustee’s discretion or can request funds for health care, maintenance, support and education.
Having a corporate trustee means an unbiased professional decides whether beneficiaries’ requests align with the terms of the trust. The alternative could be having an inexperienced sibling or family member act as trustee and deciding whether or not to give a beneficiary or another family member money.
These are just some of the decisions you will need to make.
Once you’ve decided you need a trust, it’s always beneficial to think these things through prior to meeting with an attorney to draft your document. Schedule an appointment with one of our trust and investment professionals to help you find the answers you need.
Investments are not FDIC insured, not bank guaranteed, and may lose value.