People spend a significant amount of time building their wealth and carefully creating trusts and estate plans to protect and preserve their assets for future generations. Yet, when it comes time to name a trustee to carry out their wishes under the terms of a trust, many people stumble. Making the right decision requires an understanding of all the fiduciary duties for which your trustee is responsible.
A trustee is a person, business or institution you select to manage, protect, preserve and administer the assets you place in trust for your named beneficiaries. Some of the responsibilities that come with this position include investing trust assets, managing tax compliance and efficiency, maintaining accurate records, reporting and evaluating beneficiaries’ needs and requests for distributions, all while maintaining a fiduciary duty to carry out the terms of the trust as specified by the grantor. Although trustees need not be experts in all these tasks, they must be prepared to commit a significant amount of time and resources to performing them regularly, using their discretion to make decisions and act in the best interests of the trust and its beneficiaries.
One way grantors can help support trustees from the outset is to provide them with a letter of wishes, outlining all their hopes and goals for their beneficiaries and the rules and limitations they want their trustees to follow when carrying out the terms of the trust. Although these separate documents are not legally binding, they serve an essential purpose, helping to guide trustees’ decision-making, especially when beneficiaries reach the age at which they become the trustees of their trust instruments.
Family and Friends
Usually, people’s first instinct is to select a trustee from within their own families or network of friends. After all, who knows you better than your spouse, a sibling or best friend who has known you most of your life and shares your values? Who do your beneficiaries know and trust? Who are you confident will be able to step into your shoes and make the decisions you would make if you were no longer able to do so? Because family members and friends are the most common answers to these questions, they are the most frequently relied on sources to serve as trustees. Under most circumstances, these arrangements work best for most people. However, not everyone has the same family dynamics.
Before naming a family member or friend as a trustee, recognize that what you consider fair and equitable may not be regarded the same way among your heirs and may lead to family discord. Ask yourself if selecting one family member over another will exacerbate existing tensions among your beneficiaries. Would there be more harmony if you name all your children as equal co-trustees? Can whomever you choose be impartial, separating their interest from those of the trust and its beneficiaries?
Should you wish to name a trustee who knows you intimately, but you are wary of creating any perceptions of bias, competition or resentment among family members, you may name a close friend or trusted advisor as your primary or co-trustee. Either way, you should always assign a successor trustee to take over should your original selection pass away or be unable to continue performing their duties.
Trusted Advisors
Your attorney and accountant likely understand your unique needs and goals, as well as how they align with your family dynamics. It is also probable they have some level of experience serving as trustees, managing trust assets and carrying out their clients’ estate plans.
While naming a trusted advisor to serve as a trustee may help reduce perceptions of bias and the risk of family conflict, their professional expertise comes at the cost of higher administration fees compared to those that a friend or family member would charge. Moreover, when your trustee is one of your trusted advisors, a conflict of interest may arise if family members also retain them for their personal needs.
Banks and Trust Companies
There is a wide variety of corporate trustees that operate for the sole purpose of managing and executing family trusts. These banks and financial institutions employ licensed professionals and have the systems, processes, and procedures in place to meet their legal responsibilities, including managing trust assets, filing tax returns, distributing statements to beneficiaries, and overseeing other trust duties. However, because the primary focus of these institutions is on trust investment and administration, they will likely follow strict guidelines and be far more rigid and restrictive than a family member, friend or personal advisor when making decisions that affect beneficiaries, each of whom may have different needs and goals. This level of expertise and commitment also results in fees that can run as high as 2 percent of trust assets.
Choosing the right trustee to carry out your wishes can be challenging. However, your trusted advisors can help ensure that you consider the full realm of options available to you and plan for all the what-if scenarios that can occur based on your ultimate decision. Whether you select one person or a team of trustees, be intentional in documenting your wishes and spending time with those individuals to help ensure they understand and respect your values and beliefs and that they are prepared to preserve your legacy and pass it on to future generations as you intend.
About the Author: Eric Zeitlin is managing director of Provenance Wealth Advisors (PWA), an Independent Registered Investment Advisor affiliated with Berkowitz Pollack Brant Advisors + CPAs and a registered representative with PWA Securities, LLC. He can be reached at the firm’s Fort Lauderdale, Fla., office at (954) 712-8888 or info@provwealth.com.
Provenance Wealth Advisors (PWA), 200 E. Las Olas Blvd., 19th Floor, Ft. Lauderdale, FL 33301 (954) 712-8888.
Eric Zeitlin is a registered representative of and offers securities through PWA Securities, LLC, Member FINRA/SIPC.
This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct.
Any opinions are those of the advisors of PWA and not necessarily those of PWA Securities, LLC. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of PWAS, we are not qualified to render advice on tax or legal matters. You should discuss any tax or legal matters with the appropriate professional. Prior to making any investment decision, please consult with your financial advisor about your individual situation.
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Updated on September 9, 2025