The estate planning process for parents can be long, especially for high-net-worth families. This is because you have both more assets and income to plan for the average estate planner, in addition to all the normal familial considerations. Additionally, you may be tempted to just use a family member as a trustee. After all, if you trusted them to care for your kids as the guardian, certainly you can trust them with your money as well, right? Not so fast.
Trustee vs. guardian
Logically, trusting your kids with someone should mean trusting your money with them as well, but the job of trustee is very different from the job of guardian. First, being a parent requires time, commitment, love and resources. And, it ends once the child turns 18. On the other hand, a trustee is a job, a literal job. It is time consuming, fraught with potential liability, extremely technical and lasts for decades, sometimes longer than a person’s natural life. This is why you should hire a professional trustee or trustee entity in Severna Park, Maryland.
Costs
When hiring a professional trustee or trustee entity, the first consideration is cost. You need the comprehensive fee (the out the door price) that includes everything. Remember, a trustee needs to manage money, assets, taxes, accounting, etc., so the trustee needs access to many skillsets or professionals, who may themselves, have separate fees. This is why you need the comprehensive fee that includes these fees. Plus, you may find that some trustees are just too expensive, but keep searching because you will find the right one.
Experience
Just like you do not want to be a surgeon’s first patient, you do not want an inexperienced trustee. Along with the highly technical aspects of a trustee’s job, you also need the trustee to make difficult decisions. They need to know when to say, “yes” to your beneficiaries, but also (perhaps, more importantly) when to say, “no.”
For example, if one of your beneficiaries is addicted to drugs, your trustee needs to recognize the symptoms, cut off the funds and find your beneficiary help. The ability to say no here could save your loved one’s life. What you do not want is a dispassionate or inexperienced trustee who does not recognize the signs or does not care and just keeps the money flowing. It could kill your loved one.
Safeguards and liability protection
Make sure your Severna Park, Maryland, trustee is insured against loss and liability. Especially for large trusts, there will be litigation in the future, and you want to make sure that the trustee has the appropriate safeguards and liability protections in place to survive.
