Month: March 2015

Benefits of a Professional Fiduciary Trustee

Implementing a revocable trust is the foundation of any good estate plan and most if not all persons undertaking estate planning should not be without one. The trustee of the revocable trust is the person who manages the trust property akin to a chief executive of an organization. In most cases the person creating the revocable trust is named as the initial trustee and will perform that role for many years without much difficulty. The problem arises when the person who created the trust and is serving as the initial trustee dies or suffers and accident or disability that renders them incapacitated and unable to serve.

When the revocable trust is prepared, detailed provisions should be incorporated in the trust document providing for a successor trustee to assume the office and perform the functions when the initial trustee is no longer able. The person creating the trust should nominate others to serve as successor trustees when that time comes. However, many times suitable candidates may not come to mind due to factors such as family members that are not capable of performing the role for one reason or another and a lack of acquaintances that are not good candidates for nomination. Furthermore, sound estate planning warrants that more than one person should be named as successor trustee if the first person nominated is not able to serve.

In that event a professional trustee or professional fiduciary may be a beneficial option for a successor trustee of the revocable trust. A professional fiduciary is a person who performs trustee duties and other fiduciary roles as an occupation. In California, professional fiduciaries are licensed and regulated by the Department of Consumer Affairs Professional Fiduciaries Bureau. Additionally, many are members of professional associations and some carry either errors and omission insurance or professional liability insurance. Due to the personal nature of fiduciary services any person considering a professional trustee for their revocable trust should interview several candidates and satisfy themselves as the financial strength, talents, skill, veracity and professionalism of those under consideration.