When creating a trust, the selection of trustee is of paramount importance. Typically, the creator of the trust would declare himself or herself as the initial trustee—to serve as such as long as he/she is alive and mentally competent. For a joint spousal trust, this would generally entail having joint trustees (the spouses). Trustee selection becomes more central when determining who to name as “successor” trustee—in other words, who will serve as trustee after the creator dies (or becomes mentally incompetent). The successor trustee will fulfill two general duties: (1) manage trust assets prior to distribution (investment, etc.) and (2) make trust distributions within the parameters established within the trust document.
When counseling clients regarding selection of a successor trustee, I generally emphasize the important characteristics of (i) financial acumen, (ii) trustworthiness, (iii) communication skills and (iv) a commitment to understanding and carrying out the client’s wishes. Often, a close family member is well situated to serve as a successor trustee. Other times, a friend or professional colleague is best suited for this role. We also frequently consider the possibility of an institutional trustee (bank, lawyer, trust company, etc.). For most clients, an institutional trustee is not ideal due to the related fees—but there are situations where this is preferred. Every situation and every client is different, so there is truly no one-size-fits-all answer to trustee selection.