You just learned that your deceased relative made you the trustee of his trust. You have never been a trustee before and have little idea how to do this job. Will it take a lot of time? Is it hard? Do you need a lawyer? Here are some answers.
What Does a Trustee Do?
A trustee manages all the property that is in a trust for the benefit of beneficiaries. The trustee technically holds legal title to the trust property. However, he or she cannot use the property for personal benefit. The trustee must invest the property in a prudent way. Decisions made about the trust property and distributions of it to the beneficiaries must be reasonable and fair.
What Kind of Time Commitment Can You Expect?
In practice, trustees must research and initiate investments, perform maintenance on property, respond to beneficiaries’ requests, do paperwork, keep records, file taxes, and more. The amount of time this takes varies widely from trust to trust. If the trustee has a lot of property or money to manage, or if there is a high-maintenance asset, it may take a considerable amount of time. If the trust is small and just has a house or a small amount of money in it, an individual trustee may have no difficulty handling it.
Often, inexperienced trustees need to hire professionals to help them manage trusts. You may need the help of an accountant, financial advisor, real estate management company, appraiser, or lawyer. You should seek out help if you do not have experience in a particular area needed to maintain the trust. For example, many trustees employ accountants to do the trust’s yearly accountings and taxes.
Do You Need a Lawyer?
Many trustees need lawyers to help them fulfill their duties to the trusts. A lawyer can help with issues such as interpreting the trust document, handling legal disputes, determining the trustee’s obligations to the beneficiaries, and more. If you are an inexperienced trustee, you should talk to a lawyer before you get started with trust administration to learn more about your new role.
Newly appointed trustee of a trust? Look to Janet Brewer, Esq. for thorough and thoughtful estate planning advice. Janet’s more than 20 years of legal experience will give you confidence and peace of mind. To schedule a “Get Acquainted” meeting, visit Janet's website or call her office at (650) 469-8206.