How to Change the Executor of a Family Trust
Assess your options., Interview potential candidates., Gather documents and information., Consider using an institutional trustee., Make your final selection.
Step-by-Step Guide
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Step 1: Assess your options.
Even if you have someone particular in mind who you want to name as your new trustee, you want to look at anyone else who might work well in the role and make your choice from a field of candidates.Keep in mind that while the duties of an executor of a will typically will wrap up within a year or so, a trustee may need to continue fulfilling that role for a number of years after your death.
While most people prefer a family member to act as trustee of a family trust, you also need someone who has a good understanding of your finances and how to handle any investments you have included in the trust.
You also want to take people's health and age into account.
For example, if you want your spouse to be trustee but they are around the same age as you, it might help to add someone as a co-trustee in the event they are unable to fulfill the role.
You also want to consider family relations and the potential for animosity.
For example, if you have two sons who have grown estranged from each other, you may not want to appoint them as co-trustees if they're going to have difficulty working together. -
Step 2: Interview potential candidates.
Before you make your choice, you must sit down with the people you're considering as potential trustees and make sure they understand the work and commitment involved in the role.It may seem silly to conduct a formal interview with someone who is a family member you know very well, but you still need to ensure that each person understands the responsibilities that being a trustee entails.
You also need to be able to make an objective decision as to who potentially will be in the best position to take on the role.
While you can't predict the future, you want to name someone as a trustee who is in a relatively stable position in life.
In addition to the primary trustee, you also want to think about a backup.
Most attorneys and estate planners will recommend that you either name a successor trustee or allow your trustee to appoint someone in case they cannot fulfill their duties.
If you're thinking about modifying an existing family trust to change your trustee, look for at least two people.
You can have them act together as co-trustees, or name the second as a successor to the first.
Naming more than one person significantly decreases the odds that you'll have to modify your trust again in your lifetime. , Anyone you're seriously considering as a trustee should have a good understanding of the way your trust is structured, the assets contained in the trust, and what their responsibilities will be after your death.You want to start by showing them the trust document itself so they understand the trust and the responsibilities that will be entrusted to them as trustee.
Beyond that, your trustee should have detailed information about all of your accounts and assets, including account numbers or passwords and the location of important documents.
Make sure those you're naming as trustees fully understand their responsibilities and the fiduciary duties of a trustee and are capable of performing them.
If you worked with an attorney to draw up your trust documents, you may want to have him or her sit down with your potential trustees to explain the trust and answer any questions. , Particularly if you have significant assets or the trustee's duties are expected to last for several years, you may want to consider naming a bank or law firm as trustee.One benefit of using a bank or law firm as a trustee is that you won't have to worry about whether they are around to fulfill the duties with the time comes.
You also can be assured that the institution has the expertise necessary to handle your accounts and investments.
While you may not want to name an institution as your primary trustee, a bank or law firm makes sense to use as a successor trustee.
There's less worry that an institution will be unable to step in if the primary trustee is unable to fulfill their duties. , The individual or institution you choose as your trustee should be prepared to take on the responsibilities of trustee and to perform them for a number of years, if necessary, after your death.Before you start modifying your trust documents, make sure the person you've chosen knows that you've decided to name them as trustee of the family trust, and that they understand fully what that entails.
If you're choosing a new trustee to replace someone already named in your trust documents, you also need to let the current trustee know that they are being removed.
Depending on who you've chosen, you also may want to let key trust beneficiaries know that you intend to change the trustee.
Keeping everyone on the same page now can avoid confusion later on. -
Step 3: Gather documents and information.
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Step 4: Consider using an institutional trustee.
-
Step 5: Make your final selection.
Detailed Guide
Even if you have someone particular in mind who you want to name as your new trustee, you want to look at anyone else who might work well in the role and make your choice from a field of candidates.Keep in mind that while the duties of an executor of a will typically will wrap up within a year or so, a trustee may need to continue fulfilling that role for a number of years after your death.
While most people prefer a family member to act as trustee of a family trust, you also need someone who has a good understanding of your finances and how to handle any investments you have included in the trust.
You also want to take people's health and age into account.
For example, if you want your spouse to be trustee but they are around the same age as you, it might help to add someone as a co-trustee in the event they are unable to fulfill the role.
You also want to consider family relations and the potential for animosity.
For example, if you have two sons who have grown estranged from each other, you may not want to appoint them as co-trustees if they're going to have difficulty working together.
Before you make your choice, you must sit down with the people you're considering as potential trustees and make sure they understand the work and commitment involved in the role.It may seem silly to conduct a formal interview with someone who is a family member you know very well, but you still need to ensure that each person understands the responsibilities that being a trustee entails.
You also need to be able to make an objective decision as to who potentially will be in the best position to take on the role.
While you can't predict the future, you want to name someone as a trustee who is in a relatively stable position in life.
In addition to the primary trustee, you also want to think about a backup.
Most attorneys and estate planners will recommend that you either name a successor trustee or allow your trustee to appoint someone in case they cannot fulfill their duties.
If you're thinking about modifying an existing family trust to change your trustee, look for at least two people.
You can have them act together as co-trustees, or name the second as a successor to the first.
Naming more than one person significantly decreases the odds that you'll have to modify your trust again in your lifetime. , Anyone you're seriously considering as a trustee should have a good understanding of the way your trust is structured, the assets contained in the trust, and what their responsibilities will be after your death.You want to start by showing them the trust document itself so they understand the trust and the responsibilities that will be entrusted to them as trustee.
Beyond that, your trustee should have detailed information about all of your accounts and assets, including account numbers or passwords and the location of important documents.
Make sure those you're naming as trustees fully understand their responsibilities and the fiduciary duties of a trustee and are capable of performing them.
If you worked with an attorney to draw up your trust documents, you may want to have him or her sit down with your potential trustees to explain the trust and answer any questions. , Particularly if you have significant assets or the trustee's duties are expected to last for several years, you may want to consider naming a bank or law firm as trustee.One benefit of using a bank or law firm as a trustee is that you won't have to worry about whether they are around to fulfill the duties with the time comes.
You also can be assured that the institution has the expertise necessary to handle your accounts and investments.
While you may not want to name an institution as your primary trustee, a bank or law firm makes sense to use as a successor trustee.
There's less worry that an institution will be unable to step in if the primary trustee is unable to fulfill their duties. , The individual or institution you choose as your trustee should be prepared to take on the responsibilities of trustee and to perform them for a number of years, if necessary, after your death.Before you start modifying your trust documents, make sure the person you've chosen knows that you've decided to name them as trustee of the family trust, and that they understand fully what that entails.
If you're choosing a new trustee to replace someone already named in your trust documents, you also need to let the current trustee know that they are being removed.
Depending on who you've chosen, you also may want to let key trust beneficiaries know that you intend to change the trustee.
Keeping everyone on the same page now can avoid confusion later on.
About the Author
Michael Powell
Creates helpful guides on crafts to inspire and educate readers.
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