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Investing/Strategies / Retirement Investing
|Subject: Re: trustee responsibilities||Date: 4/10/1997 8:23 AM|
|Author: Trini209||Number: 10 of 78013|
On Tue, 08 Apr 97 16:25:58 -0600, mkbca wrote:
<<Are there any good books, articles, etc. about the duties of being a trustee or co-trustee? There is plenty of literature about setting up trusts and estate planning but very little (that I've found anyway) that discuss what to do with the trust once it is activated (e.g.upon death of the parent) and the role and duty of the trustee.
My favorite book for guidance in administering the trust I manage is "The Living Trust" by Henry W. Abts, 1989, published by Contemporary Books, 180 North Michigan Ave, Chicago, IL 60601. Perhaps there's a more recent edition, but this one works just fine. The entire book is useful, and I'd recommend reading it all so that you have a good working knowlege of how a trust such as yours works, but in particular, there's a chapter called "Settling the Estate" which is invaluable for learning how to administer the trust simply. The book is written for the layman. At the time I bought it 3 or 4 years ago, it was available in most of the major bookstores - maybe it still is, or maybe you can get it from Amazon Books, on the WEB.
From my own knowlege, I can tell you a few things. First, you have a FIDUCIARY RESPONSIBILITY (that means an important legal responsibility) as the trustee. You cannot dip into the funds for your own use, although your surviving parent can stipulate in the trust that you, as trustee, can make gifts of $10,000 a year from the trust (such as to your children, siblings, etc.). If your surviving parent has not stipulated that right in the trust, and is still mentally capable or making that choice, he or she can have a lawyer produce an amendment to the trust to that effect (however, it would only apply to the survivor's half of the trust - the part belonging to the deceased parent became IRREVOCABLE upon his death).
Next, your responsibility is to invest prudently enough to maintain your surviving parent comfortably, but if there are more than enough funds to do that, you are free to invest the excess portion, which may be the bulk of the estate, to the advantage of the people who will inherit. You might diversify these funds in the same way you would invest your own money - according to your own tolerance for risk - in stocks, growth funds, etc.
Make sure that your surviving parent, who has taken care to set up a trust, also has a living will, a durable power of attorney for health (also called a health care proxy) allowing you or a person of her choice to make health care decisions when and if she is incapacitated, and that she has placed all of her property into the trust (unless her lawyer specifically instructs her NOT to place something into the trust (such as IRA's, 401K's, etc - discuss this with her lawyer).
Pick my brain if you want - I'm not a lawyer, but a trustee like yourself, but you may be able to benefit from my experience.
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