Grantor Considerations

Why consider an independent trustee?

Your trust and estate planning documents can be complex with very detailed instructions.  The documents, often referred to as governing instruments, must be administered pursuant to the situs (the state in which it is domiciled) and often IRS code.  To ensure compliance, it is important to have a professional trustee monitor these laws and administer the trust with a sensitive approach to protect the integrity of the grantor’s wishes.

To access a brief case study about the use of independent trusteeship, click here.

How does a professional trustee help manage trust assets?

Some investments can lose value if unsupervised.  Prudentia does not manage marketable securities and encourages clients to retain their own investment manager.  It is prudent to review the investment performance annually by an unbiased party.  An investment policy statement must be developed to ensure the asset management needs of the trust corresponds to the current and future beneficiary interests.  Some investment decisions can lead to adverse tax implications. Precious family heirlooms need to be identified and protected for future preservation.  An experienced team can support the management and ongoing oversight of the trust property, advise beneficiaries for asset protection and provide suggestions to achieve tax efficiency with the overall investment mix.

Real estate, closely held business interests, limited partnerships, oil / gas interests, precious metals, concentrated or restricted stock, and valuable tangible trust property are unique assets that require special attention.  Prudentia has experience with the ongoing fiduciary management of such property.

Who is on your team?

A good estate plan is not very effective without a strong team of professionals.  Your trustee should have access to all members of your team, such as your attorney, CPA and investment advisor.  Additionally, your trustee will need access to any relevant service agreements or related estate plan documents. The professional trustee develops relationships with additional professionals as needed. Consistent communication and integrity keeps these relationships in tact to protect the grantor’s intent, while effectively serving the needs of the beneficiaries.

Will there be discontent amongst siblings?

Trust documents, wills, and health care directives can protect you, your spouse and loved ones from disagreements and conflicts of interest. Making these decisions can be difficult, but ultimately brings peace and harmony to the family.

Emotions often run high after the loss of a loved one, and in some families, it becomes a destructive force amongst heirs when attempting to negotiate the estate settlement or trust funding process.  Assets also tend to stress sibling or blended family relationships, leading to discontent or even litigation.  Having an unbiased, third-party advocate to fairly execute the grantor’s wishes is well worth the fee when considering the preservation of family relationships.

How can family members maintain control?

Prudentia provides for co-trustee relationships, where family members may jointly serve as trustee of the trust.  With these appointments, our team will request the family co-trustee(s) to delegate their authority to ensure Prudentia is free to administer the trust efficiently.

At any point, the family co-trustee my retract the delegation of authority to assume their joint fiduciary management responsibilities.  Additionally, in the event family members wish to relieve Prudentia as trustee, they have the power to remove and appoint a successor trustee.

What does it mean to “fund the trust?”

Funding the trust is a very important process, yet often neglected.  Prudentia works diligently to help families work through the trust funding process.  Assets not transferred or assigned to the trust will be subject to the probate process.  Avoiding probate is usually a key objective for grantors as it makes it far more difficult to challenge asset control with litigation and keep the estate details from becoming public record.  Our team is prepared to help you through this process.