Northington Blog

The Selection Of A Trustee, the most important decision…

 

At Northington, we believe that the selection of a Trustee is the most important decision you can make to help ensure your family legacy transitions efficiently and smoothly to the next generation.

A Trustee is:

A person or institution that holds or administers property or assets for the benefit of a third party.  When you’ve been chosen to act as the trustee of a trust, you must handle both money and people. You might be more worried about the financial part, but we have found the beneficiaries may prove to be your greater challenge.

Four Questions to ask to when choosing a Trustee

  1.  Are they willing?
  2.  Are they qualified?
  3.  Do they have the time?
  4.  Are they willing to assume the risk?

Why family may not be the best choice as a Trustee?

The decision comes down to what level of risk are you willing to accept to hit your Estate Planning goal.  The purpose of Estate Planning is to pass one’s family legacy to the next generation both efficiently and smoothly. We don’t like to see our clients take on any more additional risk than necessary. The problem with family Trustees  is mistrust. If you want to watch a family tear itself apart when it comes to money, especially with lots of money, you can go to family court or watch the Michael Jackson made-for-TV drama.  I have actually seen this play out in my own family back in North Carolina.  My grandfather listed his son as Trustee, his son never communicated properly with his siblings and mistrust was rampant within the family.  To this day my mom and brothers relationship has been impacted by this decision of my grandfather. Is the Trustee role worth putting family relationships at risk?

A client Trustee solution that makes sense 

The Northington group takes pride in positioning itself as a primary trusted advisor.  These relationships are often based on years of financial intimacy.  Our clients trust us in life and question why they can’t do the same in death?  You see, traditionally when one dies the successor Trustee marshals all the assets to the new Trustee. It’s kind of like having to choose a new doctor after your existing doctor of 20 years retires. And always at the time you need that relationship the most.   The solution, at Northington, is to partner with our Private Trust Corporation at LPL Financial and remain the asset manager/primary trusted advisor.  Can’t you see it? A primary trusted relationship that stays the same in life and death.  That’s financial comfort!

The cost to protect your family legacy  

You worked your entire life to build your legacy.  How important is it to you to protect it and transition it to the next generation smoothly.  A 2 million dollar estate will cost you in the ballpark of $13,000 roughly a year to have a corporate trustee.  Partnered with a primary trusted advisor we believe this is a winning business model.   Visit with northington about a complementary estate “Comfort” meeting, call me at 501.993.0167 or email me at Stephen.Northington@lpl.com   

 

Securities And Advisory Services offered through LPL Financial, A Registered Investment Advisor Member FINRA/SIPC