Perhaps, several years ago, you were asked to serve as a successor trustee for a family member or a friend and you agreed to serve without understanding the many responsibilities and duties of the trustee or the number of hours of work it takes to administer a trust.
As a successor trustee, your number one priority must be to ensure that the debts and taxes of the estate are paid and that the assets are distributed exactly as set forth in the living trust document. Trustees may be tempted to deviate from the terms of the trust; however, the first and most important role of the trustee is to follow the provisions set forth in the trust document. A trustee cannot be influenced by the special requests of the beneficiaries.
The next important item to remember is that the trustee must manage the trust assets in a reasonable manner. A trustee cannot place trust assets in risky investments, but must continue to manage them in a conservative, interest- bearing account.
The trustee must always remember the cardinal rule that commingling the trustee’s assets and the trust assets are strictly forbidden. All trust assets must be kept in a separate trust account.
Finally, it is crucial for the trustee to keep good records. The trustee must keep an accounting of all of his or her financial transaction. To that end, many trustees will use either Excel or Quick Books to maintain these records. It is important for the trustee to maintain a good filing system and keep all copies of receipts and supporting documentation.
Serving as a trustee may seem like an overwhelming task, but with proper organization and professional advice, you will ensure that your duties are fulfilled and the wishes of the decedent are followed.
Natalie Spiwak is the CEO and Founder of Affinity Trusts. Affinity Trusts aligns with the leading estate planning law firm, Citadel Law Corporation, to provide SAFE Credit Union members a complete range of advanced estate planning services. By providing accessible seminars, and engaging in personal dialogue with clients about estate planning, Affinity Trusts serves the life-planning needs of many with a high level of passion, expertise and integrity.
When not busy with her clients, Natalie loves spending time with her two young children and because she also has a degree in archeology, loves traveling the world!
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