Trusts are popular because they allow people to set aside money to hand down to their loved ones as an inheritance without having to deal with the time and costs of the probate process. When you execute an irrevocable trust, you will need to name a trustee. It is tempting to name a loved one to that role. However, is that always the right choice?
What does a trustee do?
The trustee has an integral role in the management of the trust both while you are alive and after your death. They protect assets, prevent spendthrift tendencies, keep transactions private and reduce estate and gift taxes. Then, once you pass away, there are the administrative tasks associated with the trust. These are roles that many of your loved ones, no matter how knowledgeable, may not have experience with and naming a loved one as trustee could also cause family friction.
Selecting a professional trustee
For these reasons, some people choose to go with a professional trustee. A neutral third-party can handle trust matters with experience and objectivity. This makes it more likely that your wishes will be carried out. Professional trustees know how to take on the time-consuming activities of managing a trust, as well as fulfilling fiduciary and legal obligations.
Learn more about estate planning in Michigan
If you feel a loved one is capable of taking on the role of trustee, this may be something to consider. If not, you may want to consider selecting a financial or legal professional as trustee. Ultimately, this post is for educational purposes only and does not contain legal advice. Those who want to learn more about estate planning in Michigan are encouraged to explore our firm’s website for further information.