In its simplest terms, a trustee is an individual who manages and distributes assets within a trust as instructed by a grantor in their terms and conditions. This may seem easy enough, but the responsibilities are far more complex than this surface-level explanation. Follow along to find out if you are allowed to serve as trustee and how a proficient New York City trusts attorney at Zimmet Law Group, P.C. can help determine if you should volunteer yourself in the first place.
Who is allowed to serve as the trustee of a trust?
New York estate law allows anyone to serve as a trustee of a trust so long as they are of sound mind. That is, an individual must possess the mental capacity to handle their own affairs before they can even worry about handling that of a grantor. For this reason, it may not be surprising that you were asked to be a trustee if you are a grantor’s spouse, child, or another close family member or friend.
On the other hand, to avoid jeopardizing the close relationship you share with a grantor, they may appoint a corporate trustee instead. A corporate trustee is typically a bank or investment firm hired as an impartial, independent third party to interpret and execute the trust’s terms and conditions. This is especially best if the trust holds complex assets or you foresee conflicts between you and a grantor’s appointed beneficiaries.
Or, a grantor may appoint you as a trustee alongside a trust protector or trust advisory committee. This is so you may be offered guidance and support whenever needed as you carry out your duties. This is especially best if this is your first time in this position.
How can I determine my capability to fulfill this role and responsibility?
For starters, you must look inward to determine your capability to fulfill the role and responsibility of a trustee. That is, you must be honest with yourself as to whether you can commit the time and energy to carry out your duties effectively. Specifically, do you have the bandwidth to fulfill your fiduciary duty to act in the best interest of the trust’s beneficiaries? This is a serious question that demands a candid answer.
Even if you are confident in your capability to fulfill this role and responsibility, you may want a safety net provided just in case. This may prompt you to ask a grantor if they can also name a successor trustee of the trust. This individual may step in and assume responsibility should unexpected circumstances arise and you become unable or unwilling to do so yourself.
You may rest easier knowing that a talented New York City estate planning attorney can be the support system you need during this complicated time. So please call us at Zimmet Law Group, P.C. today.
