If you are a wise money manager, you are probably well versed in the type of analyses that go into making an investment decision. But how do you know who to trust?
Selecting a trustee to hold and manage your assets after your death is no different, except for one thing. In many cases, the trustee is simply a human being. And if you think assessing an investment is a gamble, try predicting the actions of a friend or family member some day in the future, after you are gone. Talk about volatility.
So, how do you decide? Consider the following as a starting point:
- Individual or entity? The trustee can be any person you literally trust, or it can be a financial institution such as a bank or trust company. Each has advantages and disadvantages, often at opposite ends of the spectrum. For instance, a friend or family member may be more sensitive to your family dynamics. By the same token, an institution may be better able to make unbiased decisions based on facts rather than personal drama.
- Family member or not? Again, you may feel more comfortable putting your assets in the hands of someone close to you. But you must be very conscious of the potential for conflicts of interest, not to mention conflicts with other family members.
- Hearts or minds? Some potential trustees may have their heart in the right place, but not have the financial knowledge or even the time or inclination to control your assets effectively. A more savvy money manager, on the other hand, may not act with the level of caring and loyalty you would want for your beneficiaries.
There are many, many more considerations. Be sure you discuss your options with an estate planning attorney at Doane & Doane in the Palm Beaches and Treasure Coast before making any commitments.
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