How Do You Choose a Trustee?

7 Jan 2023 · 1 min

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In this instructional video, the speaker explains how to select a trustee to manage your estate after death. He outlines a practical trustworthiness test—asking whether you would trust the person to hold $1,000—as a baseline. He then stresses the importance of financial competence and the need to compensate the trustee for the significant workload. The speaker lists typical candidate sources: family members (if they meet the trust and competence criteria), trusted professionals such as lawyers or accountants, and professional trust companies that are independent of family influence. Finally, he emphasizes three essential factors for any trustee choice: the ability to devote sufficient time, reliability, and the requisite expertise and experience to handle the specific estate.

Chapters

How do you choose a trustee? That's a great question. I would love to tell you. For this video, I'm talking about the type of trustee that will manage your estate when you have exited the planet. First, as the name suggests, your trustee should be someone you trust. Here's a good test. Think of the person you're considering, then ask yourself this question: Would you trust this person to hold $1,000 for you? If the answer is no, that's not your trustee. Is this person good with money? Most people think first about family members for this position, and that's fine as long as they fit within the parameters of step 1 and 2. Remember, it's going to be a lot of work, so you want to provide in the trust that they will be paid for their time. If you do not have a family member that fits the bill, you might want to think about a lawyer or an accountant that you trust implicitly. Next in line would probably be a trust company. These are professionals that manage trusts for you. They won't be beholden to anyone in the family. Whoever you choose, keep these 3 factors in mind: they must be able to devote the time that it will take to do this, they must be reliable, and they must have the expertise and experience to deal with an estate like yours.