A trust can be a great way to ensure that a person’s assets are managed effectively after they pass—without having to go through the laborious probate process. The actual course of administering the trust, though, is not without its own complications. While many people have certain expectations about what the trust administration process will be like, the reality is often a little bit different. Whether you’re a trustee or a beneficiary, hiring an experienced estate planning lawyer is essential to successfully navigating the process.
Myths vs. Reality
Here are a few important things to know about trust administration that might be different from your expectations:
- The Powers of a Trustee are Limited. Many people who are appointed as trustees don’t fully understand their role. Trustees cannot simply do whatever they want with the trust, but are legally sworn to act in the best interest of the trust’s beneficiaries as well as abide by the terms of the trust set forth by the trust’s creator.
- You Must Pay Off Debts and Obligations. Administering a trust isn’t all about distributing assets. Almost all trusts come with some forms of debts or obligations that are the trustee’s responsibility to pay off using trust property. These may include loans, bills, credit card balances, as well as various fees.
- The Distribution of Assets Can Be Knotty. Distributing assets to the trust’s beneficiaries can be one of the most rewarding parts of trust administration, but it is not without its complications. There are several different types of distributions that the trustee is responsible for, including specific distributions as outlined in the trust’s personal property memorandum. The trustee may also have to deal with dissatisfied beneficiaries who feel that they did not get their due from the trust.
- You Can’t Go It Alone. It may be tempting for a trustee to think that they can manage the administration of the trust by themselves. The truth is that it is a complex process with many unforeseen wrinkles lying in wait for the trustee. Hiring an experienced estate planning lawyer is the only way to be sure that a trust will be successfully administered according to the wishes of the settler.
If you’re a trustee and it’s time to administer the trust—or if you’re a beneficiary with some questions about your role in the process—speaking with an experienced estate planning lawyer is an important first step.
At Caress Law, we’re here to help answer any questions you might have. Give us a call today at (503) 292-8990 or fill out the contact form below.
