Being appointed the trustee of a trust fund or living will can be both exciting and puzzling at the same time. There is much to learn, especially when you are suddenly responsible for what could be a large amount of money. If you are new to the experience of being a trustee, you probably have questions about your rights and responsibilities, and knowing the answers to a few of the most common may help you navigate this experience with more confidence.
- Do I Need To Create a Separate Bank Account?
If you are the trustee of an account and you plan to make investments and move money around within the trust, then it is a good idea to set up a separate bank account. Not only might this make bookkeeping easier, but it can also give you a definite idea of which funds are being invested where. This can be especially important if you are the trustee of an account that will pass to minor beneficiaries once they come of age, so you have proof of the investments you made on their behalf.
- Can I Make Loans From the Trust?
As a trustee, your main role is to protect the trust and its assets until the beneficiaries are old enough to handle it on their own, and this includes deciding what loans, if any, can be made out of the funds. If you are the only trustee, you may be able to make a loan to any listed beneficiary; however, if you are one of several trustees, each individual involved typically has to agree to the proposed loan. If you are the trustee of a living will, the author of that document may still retain some control of the assets.
- Am I Responsible for Asset Upkeep?
Assets can include both money and property, and as a trustee, you may be responsible for any physical upkeep of real estate listed in a trust. This includes landscaping, exterior painting, pest control and paying any property taxes owed. It may also be your responsibility to ensure that physical assets are properly insured against fire, theft and other types of possible loss.
- Who Do I Need to Report Activity To?
If you are the sole trustee of a will or other type of trust, you may have to report to the beneficiary’s legal guardians or their lawyers. You might want to consider finding a lawyer to assist you as well, especially if you are in control of a large trust and want to protect yourself as well as the trust.
As a trustee, you are likely to have many questions about your rights and responsibilities, but help is available. Contact an attorney, like a probate lawyer in Folsom, CA, today for more information.
Thank you to Yee Law Group, PC for their insight into probate law.