Revocable living trusts have many benefits, including avoiding probate, providing privacy and allowing for some additional control. One critical part of revocable living trusts is selecting your successor trustee.
Typically, the grantor of a revocable living trust is also the trustee. However, you need to carefully select your successor.
When does the successor trustee step in?
As the grantor of your revocable living trust, you generally retain control over the trust and its assets until you die. At that point, the trust becomes irrevocable, and your designated successor trustee will take charge.
A living trust can also become irrevocable when the grantor becomes incapacitated and can no longer make decisions for themselves. For example, if you have a stroke, are left in a coma after an accident or develop dementia, your successor trustee will have to take over the management of the trust on your behalf.
What qualities should you look for?
So, how do you choose the right person to be your successor trustee? Here are some qualities your candidates need to have:
- Trustworthiness: The successor trustee will have control over your assets and will need to act in your best interests – or the best interests of your beneficiaries. Integrity, loyalty and honesty are important.
- Financial acumen: Your chosen successor should have a good understanding of financial management, including how to manage investments, taxes and record-keeping. This is particularly important if your trust contains complex assets. If they don’t have these skills, they should at least be cognizant of the fact that they will need to engage professional assistance to help them.
- Organizational skills: Managing a trust involves a lot of paperwork and attention to detail. Choose someone who is organized and responsible. Even if they’re relying on professional assistance for a lot of the work, they need to be responsive and prompt about their duties.
- Willingness and availability: Never make this kind of designation a surprise. Make sure that the person you choose is willing to take on the responsibilities. Have a frank discussion about the time and energy they have to devote to this job.
Setting up a revocable living trust is an involved process, but it is significantly easier when you have the right legal guidance.