What Does Trust Administration Entail?

Trust administration is a legal arrangement where an individual’s assets (referred to as the settlor) are transferred to another entity (the trustee) who oversees these assets on behalf of another set of persons (the beneficiaries).
A trust deed is a written document that outlines the beneficiaries’ rights as well as the terms and conditions the settlor and the trustee agreed to upon creating the document.

Many factors come into play when setting up a trust, especially when selecting a competent trustee. However, this seemingly complex process can be simplified with the correct information and guidance.

Selecting a Trustee

The selection of a competent trustee can often be daunting for some. One of the reasons for this may be due to a lack of substantial information on how trust administration works. A trustee can be any of the following:

  • A family member or friend
  • A professional, e.g., accountant or lawyer
  • A corporate trustee or trust company

However, since the trustee exercises control over the trust assets, they need to be independent and unlikely to be swayed to act in a particular fashion by the settlor’s family members or other beneficiaries.

Laws governing trust administration differ from state to state. In Southern California, where we operate, Wiezorek & Geye have many years of experience in trust administration. We are here to guide you through the process from start to finish and answer any questions you may have.

Trustee Rules

  1. Trustees may not have any potential benefits from a trust, except those explicitly stated in the trust.
  2. Trustees are governed in how they exercise their power and are obligated to follow the trust deed to the letter.
  3. Trustees must have the best interests of the beneficiaries when exercising their power or control over the trust. As such, they are obliged to disregard the interests of others, including family members.
  4. Trustees hold a fiduciary duty and must be prudent in managing, investing, and distributing the trust assets, regardless of payment. As such, they will be held responsible in the case of a breach of trust or where they cannot exercise the required level of prudence toward the trust assets, causing the trust fund to drop in value.

Why You Need Trust Administration

Trust administration offers numerous benefits, including but not limited to a reduced risk of your requests being contested in court and reduced cost.

Secures Your Beneficiaries’ Future

Undergoing a valid trust administration process offers you peace, knowing that your loved ones will keep enjoying the financial benefits stated in the trust. As such, you rest assured that your children and loved ones’ future is not put in jeopardy.

Faster and Cost-Effective

When compared to probate, trust administration takes a relatively shorter time to allocate assets to beneficiaries. It also eliminates the need for the estate to pass through probate, ruling out probate-associated expenses. These cost-savings can be immensely beneficial to the deceased’s family members coping with the death of a loved one.

We Can Be of Help

As a leading Southern California law firm, we’ve successfully assisted numerous families with the trust administration process while preserving family relationships. We have a team of highly experienced attorneys who understand family dynamics and will work in tandem with the trustees and beneficiaries to ensure compliance on both ends.
You can reach out to us today to know how best we can serve you.