An important part of creating a living trust is to appoint someone to serve as successor trustee after the grantor passes away or otherwise becomes unable to manage the trust. Being appointed trustee means that you will have many different responsibilities related to the management and administration of the trust. These responsibilities will vary depending on the circumstances of a particular trust but can include the following and more:
- Investing trust assets wisely and managing current investments
- Paying taxes and other costs of the trust
- Following all instructions in the trust document
- Managing bank accounts of the trust
- Distributing trust assets and property as instructed
- Keep trust beneficiaries notified of the state of the trust assets and property
The above duties can be time-consuming and can require financial knowledge. If they are not performed correctly, trust assets can be wasted and you may face legal action from beneficiaries.
Fiduciary Duty of a Trustee
In addition to performing the duties of a trustee, you must do so with a fiduciary duty to the beneficiaries of the trust. Fiduciary duty is the highest legal standard of care and involves the following:
- Duty of loyalty – You must be loyal to the beneficiaries and must not use your position as trustee for your own personal benefit.
- Duty of care – You must take care to use all available information when making a decision regarding the trust.
- Duty of good faith – You must carry out your duties in compliance with the law and in furtherance of the interests of the beneficiaries.
- Duty of disclosure – You must be transparent and use candor in your actions as trustee.
- Duty of prudence – You must make decisions with the caution and care of another prudent trustee.
If you fail to meet your fiduciary duty, beneficiaries may file legal claims against you. This can be a lot to deal with and it is often advisable to seek assistance from an experienced estate planning lawyer to avoid any legal liability.
Call 201-498-9768 today for more information.
Being designated as a trustee is not something to be taken lightly. This can be an intimidating situation for many people, especially if you have not had experience in this position before. It is important to know that you can seek guidance and assistance from an experienced New Jersey estate planning attorney regarding your role and duties as trustee. Please do not hesitate to contact the Law Office of John L. Schettino to learn more about our services today.