You have been chosen as a Successor Trustee. It is important to know facts on what your duties are if you are chosen as a California Trustee.
- Know Your Duties
When nominated to be a trustee you owe many duties and obligations to the beneficiaries. You are a fiduciary and owe a fiduciary duty to the beneficiaries. You must always act in the best interest of the beneficiaries and estate and must not intentionally do anything that could work against the beneficiaries. Ideally, you should be fiscally sound, conservative, and financially savvy. You need to be, quite simply, a trustworthy individual. Therefore, if you are going to succeed as a Trustee, you have to know what your duties are in the first place.
- Know Who Your Beneficiaries Are
As a Trustee, you have a duty to know who your beneficiaries are. This is more important when you have the power to make distributions based on what the beneficiaries needs are and whether a distribution must be made to meet those needs. You must not ignore the beneficiary.
- Know the Trust Assets
Trustees must take control of Trust assets. When the time comes,you need to know how to gain access to your personal information and your Estate Planning documents. The more organized you are, the easier it will be for the person executing your documents. In our Estate Planning practice, we recommend that our clients create a list of active assets, such as bank accounts, retirement information with account numbers, life insurance policy information with policy numbers, real estate addresses, mortgage information, and credit card carriers. This makes the life of your trustee a lot easier. You need not provide this information to your trustee during your lifetime, but it is ideal to inform where he or she can find these details, should you pass away.
- Keep All Receipts and Statements For Accounting
Every Trustee must keep excellent records. How much money the trust has, all the expenditures, what distributions were made, etc. This record keeping would be evidenced by showing each transaction by date, description and amount. Therefore, keep all receipts, account statements, and similar financial documents so a thorough accounting can be prepared.
- Understand Trust Accounting
Probate Code section 1061 lists exactly what a Trust accounting must have.
- Communication/Information is Key
With any relationship communication is key. Communicate as often as possible with beneficiaries. The more you communicate, the better.
