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What does a trustee do?

On Behalf of | Jan 17, 2018 | trusts

When you create a trust in Sun City, you are essentially putting some of your most valuable assets in an account for future distribution. That is why it is so important to make sure that the trustee you assign to manage your trust is reliable and able to effectively manage your property on a daily basis.

Before you decide who will oversee your trust, you should note that there are multiple types of trustees. First, if you have a revocable living trust, you may serve as your own trustee, as the grantor or creator of the trust. If you become mentally incompetent, pass away or otherwise become unable to handle your affairs, the successor trustee will take over all management responsibilities. If you decide to form an irrevocable trust, you may not name yourself as a trustee. You will have to assign an individual, bank or trust company to manage your account. You may even decide to assign more than one person or entity to serve as trustee.

The trustee’s job will vary depending on what assets are in the trust. For example, a trustee may be responsible for overseeing bank accounts, managing investment accounts and handling property repairs, tenants and inspections for any rental properties in the trust. A trustee may delegate certain responsibilities to financial advisors, property managers or other professionals, as long as they do their due diligence when involving these parties.

If you assign someone to be a trustee, that person or entity has a fiduciary duty to act in the best interest of the trust’s beneficiaries. This means the trustee owes a duty of loyalty to the beneficiary and must exercise reasonable care when dealing with the assets of the trust. They are not permitted to profit at the expense of the beneficiaries, and they must put personal feelings aside when handling the trust.

Source: The Balance, “Types of Trustees and What They Do,” Julie Garber, Jan. 8, 2018