Should You Hire a Professional to Manage Your Trust?

Although it’s common to select a family member or close friend to manage a trust, that may not always be the best route. There may be situations when an individual trustee is not a viable option. Find out why the solution may lie in hiring a professional.

Trusts are a common feature of estate plans. Whether you want to preserve wealth for the future, bypass the probate process or simply ensure your wishes will be upheld, a trust can help. Often, individuals setting up a trust might wish to name a relative or close friend as the trustee. But sometimes there isn’t a viable individual trustee option or families are concerned about maintaining harmony. In addition, the appointed individual must possess the rare combination of skills and experience to ensure complex financial assets are managed prudently. In many cases, the solution may lie in hiring a professional trustee.

What are the benefits of having a professional manage your trust?

Employing a professional to take on the trustee duties can help ensure a more seamless implementation of your estate plan, such as transferring assets to heirs and protecting your legacy. Their knowledge of legalities, financial matters and compliance regulations, skill in judiciously delegating investment management responsibilities and ability to handle administrative duties can bring peace of mind knowing your assets are protected.

How do I determine what is the right path for my situation?

Deciding whether to name a professional trustee or an individual to steward your trust - either presently or as a successor - depends on your specific needs, preferences and the complexity of the trust. Considerations include:

Complexity of the trust and trust assets. For situations involving operating businesses, multi-faceted assets, intricate legal requirements or significant financial transactions, a professional trustee may be more suitable to handle these complicated issues and protect the beneficiaries.
Size of the trust. The resources, scalability and risk management capabilities of a professional may be better equipped to handle larger trusts.
Ongoing care. If you are looking for continuous trust management spanning generations, a professional trustee’s perpetual existence can provide stability.
Keeping the peace. Sometimes family and friends don’t mix well with money. Appointing an impartial and neutral third-party professional trustee may help avoid conflicts among relatives and beneficiaries.
You get what you pay for. The fees of professional trustees may be justified by the benefits and services they provide. And the cost of mistakes can be high.

Which trust company should I work with?

It’s vital that you partner with a reputable professional trust company that operates in a collaborative, collegial environment. A wealth advisor can help you search for one that:

Best fits your needs based on the size of the trust and level of service needed.
Accommodates any special needs and circumstances that may exist when executing the trust.
Follows a data-driven investment strategy for trust assets and provides continuity in working with your other professionals.
Navigates the complexities and seizes the opportunities across various state laws.
Helps you understand the trust company’s fee structure and other potential costs.

The decision to hire a professional to manage your trust should be based on your specific needs, preferences and circumstances. Consulting a wealth advisor can help you make an informed decision about the trustee options available that best fit your situation. If you are not currently working with an advisor or would like a second opinion, Beacon Hill would love to help. Please schedule a phone call or virtual meeting here.

We welcome the opportunity to learn more about your unique circumstances and share how we add value to our clients' lives. Beacon Hill Private Wealth is an independent, fee-only, fiduciary investment advisor providing evidence-based wealth planning solutions that simplify our clients' financial lives. We serve clients in the state of New Jersey and across the country.

Founder Tom Geoghegan, CFP®, CIMA®, CPWA®, RMA® is also a member of the National Association of Personal Financial Advisors (NAPFA), the Financial Planning Association (FPA), and featured on the Fee-Only Network.

We welcome the opportunity to learn more about your unique circumstances and share how Beacon Hill adds value to our clients' lives. Ready to talk? Simply schedule a phone call or virtual meeting using our Calendly booking tool.

Elliot Dole is an advisor at Buckingham Strategic Partners.

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