In the second part of this series, we look at the role of the trustee in your Will.
The trustee’s role is to manage the money and assets that your Will provides are to be held in a trust or trusts for your beneficiaries, which may include your children until they reach the age nominated in your Will.
Upon your death, your assets are distributed to the trustee who will hold and control your assets on trust on behalf of your nominated beneficiaries.
Trustees therefore have very important legal duties and responsibilities which include acting in good faith, acting in the beneficiaries’ interests and preserving any property held by the trust.
As with the role of the executor, the decision as to who you wish to be the trustee of the trusts in your Will, especially for your children, is ultimately a very personal decision for you. Your trustee should be someone who you trust to act in the best interests of all of the beneficiaries, is usually related to you and is of a suitable age as the trustee role may last for decades. Preferably, the trustee would be someone who has some commercial or business experience, although this may not be necessary if legal and/or accounting advice is obtained. While ultimately a matter for you, sometimes it is not a good idea to appoint joint trustees, for example couples, as marriages sometimes fail. If that happens and you are still alive you would need to redo your Will, if you have died the appointment could be unworkable.
To protect beneficiaries from themselves, sometimes it may also not be appropriate for a surviving spouse or a child to be the sole trustee of their trust, or to be a trustee at all.
In the case of a trustee for your childrens’ trusts, you may wish to give consideration as to whether the trustee should be someone different from the guardian, so that the trustee can offer some oversight on the other person’s actions during what might be a long time (and vice versa).
An alternate trustee should also be considered to ensure there is someone to act if the first trustee cannot act usually by reason of death, incapacity or bankruptcy.
Trustee remuneration may also need to be considered especially if there is to be a great deal of work to be undertaken by the trustee or the trustee is a professional person such a lawyer or accountant.
You can also direct the management of the trusts established within your estate via a Statement of Wishes, which is a non-binding document that gives directions to a trustee about what you wish to happen to the trust property. For example, you may wish for money to be paid to the trustee to allow your children to visit their grandparents overseas once every five years or to be enrolled in a private school.
These are all very personal decisions and we appreciate there is a lot to get through during the difficult task of administering and distributing an estate. We are professionals who have done this many times, and are happy to assist throughout the entire process to make it as easy as possible.
The information in this blog is intended only to provide a general overview and has not been prepared with a view to any particular situation or set of circumstances. It is not intended to be comprehensive nor does it constitute legal advice. While we attempt to ensure the information is current and accurate we do not guarantee its currency and accuracy. You should seek legal or other professional advice before acting or relying on any of the information in this blog as it may not be appropriate for your individual circumstances.