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When creating a trust, one important decision to make is who will act as the trustee. Choosing to name a non-family third party as the trustee of your trust can provide several benefits. Here, we will explore why this option may be considered when deciding who will oversee the trust.
Objective Decision Making
A third-party trustee has no personal ties or biases that could affect their decision-making. This means decisions are based on the best interests of the trust and its beneficiaries, rather than any personal feelings that might come into play with family members. In addition, if there is ever disagreement among beneficiaries, it may be easier to mediate if the trustee is unbiased.
Expertise in Financial Matters
A non-family third party, such as an accountant or lawyer, will have the knowledge and experience needed to handle complex financial transactions that may arise in relation to the trust’s assets. This helps ensure that all parties involved understand the trust’s financial situation and can make informed decisions about how best to manage it for the benefit of all involved.
A professional third-party trustee will have oversight from their organization or firm (or from their professional association). This provides added assurance that the trustee is following all applicable laws and regulations when managing your trust assets, which helps protect against potential liability issues down the road. Professional oversight also helps ensure that your trust assets are managed responsibly and effectively throughout the trust’s lifetime.
Is a Third-Party Trustee Right for Your Family?
Naming a non-family third party as trustee of your trust can provide numerous advantages—not only in terms of impartiality and objectivity but also practical considerations such as access to resources and expertise in managing various investments or other financial matters associated with trusts. If you are considering setting up a trust for yourself or a loved one but have concerns about choosing a trustee, the appointment of an independent third party could be worth exploring further.
Contact us to speak to a Fairfax trust lawyer at our firm. We will work with you during the planning process to weigh the pros and cons of choosing an independent trustee so that you can ultimately make the best choice for your family. To schedule a consultation, simply call our office at 703-492-9955.