{Read in 4 Minutes} As a Trusts and Estates attorney, it might not surprise you that I write a lot of Wills for people. When I’m writing a Will, people will sometimes create testamentary trusts — or, simply put, a trust that the Surrogate’s Court creates when probating the Will.
A client might create a testamentary trust to provide for their children until they reach financial maturity, to provide for a party who has a disability and is on needs-based government entitlements, or to hold money or assets for any ongoing purpose. Like Executors, who one might name in their Will, the client also gets to decide who will be the Trustee of these trusts.
A Trustee may serve for quite a while. Unlike an Executor, whose job may be temporary, a Trustee might serve for years. For example, maybe there is a trust holding money for the benefit of a two-year-old beneficiary until they turn 30, or perhaps the trust holds money for a disabled beneficiary in their 30s who might live another 50 or 60 years.
So, the first thing that one might want to consider is — whether the Trustee is willing to do this job for the long haul. Is the Trustee an older adult or a younger person? There’s nothing wrong with naming an older adult. Still, you might want to consider naming a backup Trustee who can take over at some point if the existing Trustee is unable or unwilling to do this any longer than several years in the future.
Another thing you should consider is the relationship the Trustee has with the beneficiary. You want a Trustee who has a working relationship with the beneficiary and is aware of their needs. For example, if the Trustee manages a trust for the benefit of a minor child, the Trustee should have a good working relationship with that child and their legal guardian to ensure that all the child’s needs are met (food, clothing, health care, education, etc.). Similarly, if the trust is for the benefit of someone in college and the funds are being held until they turn 30, the Trustee should know what the beneficiary’s needs are by way of tuition and housing, etc.
The Trustee also needs to have a backbone. The Trustee should be able to say no if the beneficiary asks for something beyond the original client’s intent of how the beneficiary should use the money. For example, if that college student wants a hundred thousand dollars to start a business but doesn’t have a business plan, the Trustee should say no.
These are essential things.
Similar to the requirements for serving as an Executor, there are very few exclusions when selecting a Trustee. They need to be 18 years of age, competent (of sound mind) when they need to serve, and fluent in English. Ideally, they are a US citizen, or if not, a New York-based permanent resident (green card holder). The Legislature recently amended the law to allow the Court to appoint people with felony convictions that are well in the past, minor, and unrelated to money management. That said, if you can avoid naming a felon, that is probably for the best.
So, like anything else with writing a Will, you must give your choice of Trustee a lot of thought. Make sure that the person is the proper fit for the trust and its beneficiaries before naming them in the Will. And by the way, you’ll probably want to name a backup, too, so that’s double the thinking you need to do.
For more information on this topic, please contact me.