What is a Trustee and Why Do I Need One For My Estate?
A trustee is the person who controls your trust, and it does not have to be somebody else, and at any given time you can change who your trustee is. The job of a trustee is to execute the instructions of a trust, to the letter, that is laid out by you. While you can name yourself to be your own trustee, it can also be a spouse, an adult child, a trusted friend, or even a professional. However, it is a decision that cannot be made lightly. The term is trustee because it is a trusted person who is executing your wishes and desires, so it is imperative that the person chosen to be a trusted person – one who will do as the trust instructs.
The trustee, whoever they may be, will do all of the same things that you do now regarding your finances – collect an income, pay your bills, pay taxes, and save for the future. This is why many choose themselves to be their own trustee, so that they can retain full control of their finances. With another acting as your trustee, though, you do not relinquish control over your financial assets, or any other assets included in the trust, which can alleviate many concerns while also protecting your trust for when you do pass. A professional is suggested for those who do not have a child, another trusted individual, or the time to handle the maintenance of their trust themselves. Others choose a professional or corporate trustee for their experience.
There are some things that a trustee cannot do, though, if there is only a living trust and not a living will. The trust does not allow for the control of medical decisions, which are important when the testator is incapacitated or any reason. If you want your trustee to also be able to make certain medical decisions for you, a living will must also exist – one that does not contradict or invalidate the trust in any manner, so as to protect the integrity of the trust. For the ability to make all medical decisions, you’ll need to give them health care power of attorney. It also has no effect on your income taxes, as the assets are still, in effect, in your name because it is revocable at any time. The limits and exceptions are details that are important to keep in mind when considering who you want to be your trustee.
The trust exists so that your desires can be met in as orderly a fashion as is possible, with as little interference from outside forces as possible. The reason a trustee exists is to carry out the trust’s instructions and if they fail to do so while the testator is alive or there is simply a change of heart, they can be removed from the position. It is all up to you who your put your trust in. Whether it is a friend, or a professionally unbiased party, is at your discretion.
