A trust is a legal arrangement that allows the owner, called a grantor, to hold certain assets. They are used for wealth management, estate planning, charitable donations, and more. Through a trust, the grantor can transfer ownership to a trustee who manages the assets involved on behalf of the beneficiaries. When the trust is created the grantor outlines their wishes and conditions for the trust, including which beneficiary will receive which assets, money designated for charity, etc. It can be a big job to be appointed as a trustee, but what responsibilities do they have? Read on for more information and contact a Hartford County probate attorney for legal advice.
What is a Trustee?
As established, a trustee is a person or entity that is appointed to manage certain assets on behalf of the beneficiaries of a trust. A grantor can appoint anyone they wish to be their trustee. They might choose a close friend or family member, a trustworthy attorney or accountant, or anyone they believe will best carry out the terms of the trust. A trustee must be 18 years of age or older and of sound mind.
What Responsibilities Does a Trustee Have?
Trustees have a lot of responsibilities when they are appointed to manage a trust. The following are some general duties they must complete and abide by to remain in good standing and follow their legal obligations.
- Manage assets: Maybe the most obvious duty that they have, a trustee is responsible for managing the assets and property that are held in the trust. The grantor may have designated certain funds, properties, or other assets to be distributed or assigned to beneficiaries.
- Fiduciary duties: The trustee has an ethical obligation to carry out the grantor’s wishes and act in the best interest of both the grantor and the beneficiaries. They must remain impartial and unbiased, putting the beneficiaries’ interests first. There is a lot of power given to the trustee so they have the responsibility to not abuse it.
- Communication: Beneficiaries are the ones most impacted by the trustee’s actions. The trustee has a duty to keep an open line of communication between themselves and the beneficiaries, informing them of important decisions and keeping them apprised of any updates.
- Respect the grantor’s wishes: Trusts have detailed explanations of how the grantor wants things to go. It is important that the trustee carries out these wishes and does not stray from their terms. This could include following instructions about how to distribute assets, investing money, etc.
- Keep records: Trusts can have substantial monetary value attached to the assets involved. Keeping records is an important responsibility of the trustee to avoid conflict and issues down the line. They must maintain accurate records of all transactions that take place and include detailed information about activities related to the trust.
Trustees have a lot of responsibilities. It is important for a grantor to appoint someone they know and believe to have a good moral character. If you were given the title of trustee and require legal counsel, an estate attorney can offer advice and representation.
