Have You Been Asked to Be a Trustee? Think Carefully Before You Agree

If a loved one has chosen you as a trustee, it’s important to explore what tasks are involved and how much time your duties as a trustee are likely to take. This blog will provide you with the information you need to make an informed decision. Contact us for answers to the questions this material will likely raise.

Being a trustee is a big responsibility. You have undoubtedly been chosen for the role because the family member or friend who picked you views you as knowledgeable, fiscally trustworthy, and relatively level-headed. They must also believe that you have the time and patience to handle any issues that arise. But no matter how well the trustor knows you, you know yourself even better. It may help to ask yourself the following questions:

  • How good am I at working with numbers and keeping careful records?
  • How easily am I able to say “no,” and put my foot down when necessary?
  • Do I make reasonable, cautious decisions when money is involved?
  • How well do I handle stressful situations?

If your honest answers to these questions make you feel a bit shaky, take your time deciding whether you will take the job.

What Being a Trustee Involves

As a trustee, you are responsible for managing the money in a trust, money that is not yours and that may have been set up to protect the interests of a vulnerable beneficiary. The job includes:

  • Keeping accurate records of finances
  • Communicating with the beneficiary on a regular basis
  • Making sure that the terms of the trust are followed

In order to follow the terms of the trust, you must first understand those terms precisely. 

Our skilled attorneys can assist you by translating legalese and clarifying phrases that seem ambiguous. 

It is crucial that you fully comprehend and follow the stated wishes of the trustor because if you don’t you may be held legally liable for misconduct by the beneficiary (at times with family clout behind them). It’s important to remember that being a trustee is a fiduciary responsibility.

We are not just talking about unethical behavior here. You may make careless mistakes or poor judgment calls, but whatever you do that depletes trust funds without good cause may be used as evidence of mismanagement. You also have a duty to obey federal laws and regulations in this matter. This is why it is often wise to delegate financial management, especially of investments, to a well-respected financial advisor. 

Sometimes It’s Hard to Be Diplomatic

As a trustee, your job is to follow the trustor’s instructions, even if their priorities or views differ from yours or if the beneficiary tries to pressure you. This may be particularly troublesome if you are managing a spendthrift trust in which the beneficiary routinely overspends on frivolous items or has a problem with substance abuse, gambling, or some other compulsion.

Make sure that you have a clear understanding of where the trustor wants limits set and always remember that you have a responsibility and the authority to keep to those limits. 

Better Safe Than Sorry: Talk to the Trustor and Consult With Our Trust Attorneys

It pays to discuss the situation openly with the trustor before consenting to take the position so that you have a good grip on their expectations of what you will do.

Among other things, it’s wise to find out what your reimbursement for your services will be and to have a clause written into the trust verifying the amount. Too many trustees think they do not need compensation for helping a loved one and find out later that being a trustee can become a complex, taxing, and time-consuming job.

Contact Our Experienced Trust Attorneys Before You Take the Plunge

Whether you are considering taking on the role of trustee or you are thinking of establishing a trust as part of your estate plan, Surprenant & Beneski’s talented attorneys can provide you with guidance and support. Contact us now for an informative, supportive discussion of what trusts are all about.