A corporate trustee is a trust company, investment firm, or bank trust department that manages a trust. The trustee manages and controls the trust according to the terms you outlined in the trust agreement. You can name an individual to serve as a trustee. However, it is wise to discuss the advantages of choosing a corporate trustee with a Florida estate planning attorney before making a final decision.
Five Advantages of Choosing a Corporate Trustee
Choosing a corporate trustee might seem impersonal or risky. All trustees have a duty of loyalty to the trust beneficiaries. However, there are five clear advantages to keep in mind as you consider professional trust management.
Years of Experience
You can choose a professional trust management firm or bank trust department with decades of experience managing trusts. Because of their experience, they understand the legal responsibilities of a trustee. They also understand the laws governing trusts, estate planning, and taxes. Corporate trustees can provide expert advice regarding investments and refer you to lawyers and other professionals as necessary.
A nonprofessional trustee might not have the experience to manage high-net-worth trusts, trusts with special rules, or trusts with unique assets. In addition, most family members and friends do not have the same experience as corporate trustees, even though they might have the best intentions.
Protecting Your Legacy
Corporate trustees are generally held to a higher standard by courts because the courts consider them to be experts. However, the courts might not hold a nonprofessional to the same high standards. Furthermore, corporate trustees are regulated by federal and state agencies.
Reliable, Long-Term Professional Service
A corporate trustee does not become ill, take a vacation, or die. They do not move away or become distracted by personal interests. Professional trust management gives you the peace of mind of knowing that your trust will have consistent, experienced management to accomplish your goals and protect your beneficiaries.
Corporate Trustees Are Objective
A corporate trustee follows your trust terms objectively. They do not allow emotions or family wishes to impact how they manage the trust. Therefore, you can rely on the fact that your trustee will follow the terms of the trust to the letter to ensure your wishes are carried out.
Benefits From Sound Investment Advice
A nonprofessional trustee might not understand the best way to invest the trust assets to maximize income for the trust. Therefore, they would need to hire professionals to assist or leave the trust assets invested in the same manner you invested the assets when you created the trust, which might not be optimal in five, ten, or 15 years.
However, professional trust management services recommend the best investment strategy after discussing your risk tolerance, goals, and long-term objectives. Then, after your death, the corporate trustee continues to invest the trust assets to maximize the benefit for the trust beneficiaries.
Contact Our Florida Estate Planning Attorney for More Information
Trusts are important elements of an estate plan. With a trust, you can protect assets, reduce tax liability, and have more flexibility in how your assets are distributed to your heirs. However, the person or entity you choose as a trustee can benefit or harm the goals you have for your trust.
Contact our law firm to schedule a consultation with an experienced Florida estate planning attorney to learn more about trusts and how to choose the best trustee for your trust.