When creating a trust in Michigan, you’ll need to select a person to administer it. This person will be responsible for a number of duties, from managing property owned by the trust to ensuring beneficiaries receive their allotment of assets. To make sure your trust is in the right hands, TheBalance.com offers the following tips.
Institutional trustees offer certain protections
You don’t have to choose an individual to manage your trust. Some estate planners implement a financial institution, such as a bank, to manage assets and deal with beneficiaries. Should your trustee die before you, your estate will end up in the hands of a court-appointed representative.
A bank can safeguard you against any wrongdoing, such as a trustee taking funds for his or her own personal use. It will also prevent your trust from ending up in the hands of a court-appointed representative, which is what happens when your trustee dies before you. You can even implement co-trustees, which entails both an institution and individual fulfilling the role simultaneously.
Steer clear of family disputes
If you plan on naming one of your adult children, be prepared for disputes between this person and his or her siblings. Many families find fault with this type of authority and may even claim favoritism when it comes to decisions related to the trust. Naming another family member, or even a close friend, will likely involve less contention. You can also create the trust in such a way that it’s clear all decisions are your own. That way your adult child will merely be carrying out your desired terms.
Consider a person’s skill-set
Because some administration tasks are complicated, the person you choose should also have a bit of experience in this realm. People with knowledge of real estate or investing will be able to get up to speed faster than those lacking experience. Also, look for a person who is already responsible in their own financial dealings. A person who constantly overdrafts their bank account or spends money frivolously probably isn’t the best choice.