Trustee

In our last newsletter, we talked about the common situations that occur and how establishing a trust could provide solutions and peace of mind at stressful family times.

So let’s say you’ve thought about establishing a trust, talked it over with your Frankenmuth Credit Union and Credit Union Trust advisor, and decided such safety makes sense for you and your loved ones. Now you have to decide who should serve as trustee. Should it be a family member? Should you serve as trustee and/or executor in a will?

Not only does such a role come upon us at stressful times, it carries significant responsibility with it. Before making a decision to take on that responsibility, there are some important things to know and consider.

The law imposes strict obligations and rules on trustees and it does not matter if it’s you, a family member or a corporate trustee. All are held to the same standard of care and responsibility – and one can be held personally liable for mistakes made while acting as trustee.

The law requires all trustees to act independently and impartially. Sometimes people who establish trusts will be trustees and also beneficiaries. In those cases, it can be argued there is a built-in conflict of interest and that such a trustee lacks the ability and impartiality to properly administer the trust. Appointing an independent trustee like Credit Union Trust, avoids such potential complications and ensures that all beneficiaries are treated fairly.

Another consideration to note is that a trusteeship is not a passive role. Trustees must fairly and dispassionately deal with personal and financial issues, and oftentimes. raw emotions. All trustees must take part in important decisions and are actively involved in the trust administration. In addition, there are clear functional responsibilities of trustees. They include: