It’s a scenario straight out of a movie: An oldest adult child is named the trustee or personal representative of a parent’s trust or will and before you know it, the whole family is fighting over everything from money to property to funeral arrangements.
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It’s a scenario straight out of a movie: An oldest adult child is named the trustee or personal representative of a parent’s trust or will and before you know it, the whole family is fighting over everything from money to property to funeral arrangements.
As we navigate through these uncharted waters and adjust to a new environment, it’s more important than ever to address your financial planning needs.
When setting up a trust or will or doing any estate planning, it’s wise to not appoint a family member or friend – whether an adult child or anyone else – as trustee or personal representative, for a few reasons.
1. It creates unrest and tension. Even within the most well-adjusted families, money seems to bring out the worst in people. Sooner or later, spouses, grown children and extended family suspect they’re not getting their fair share and the trustee or personal representative is to blame. It can create permanent damage to relationships built over a lifetime.
2. It puts the trustee or personal representative in unfamiliar territory. Most family members do not have legal or investment training. Having to decipher those complex concepts and translate them to other members of the family can be stressful and result in errors in understanding and execution.
3. It raises the chances of error. If there is paperwork to be filed or payments to be made, it is unwise to saddle one person with all those tasks, in addition to running their own life. It exposes the family member to personal legal liability, in the case errors are made in properly completing the tasks of the trust or estate. A corporate trustee or personal representative can make sure everything is done according to the intention of the individual and in full compliance with the law, shifting the burden of expertise and workload to an independent and objective overseer.
Enlisting the services of a corporate trustee or personal representative can not only remove the huge emotional burdens of executing a trust and/or will but can also avail the entire family of the expertise of professionals in law, finance, investing, real estate and even health care. Choices about investments, liquidations, the sale of property or the operations of limited liability corporations can all be made with the guidance of people trained in those fields. In certain cases, trustees can research nursing homes for elderly parents in need of ongoing care and set up payments for the care directly from the trust.
Part banker, part counsellor, a corporate trustee or personal representative can help guide the process the average person simply doesn’t have the expertise or time to navigate. It can be a relationship saver for the entire family, giving everyone equal peace of mind.
Losing a family member is stressful enough. Fighting over a trust or will shouldn’t compound the tragedy or loss.
