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hello welcome everyone i'm ryan listina it's another friday webinar so today the topic is trustees going to be talking about trustees what is a trustee how do you choose a trustee and what to do if you are a trustee so all things trustee is the topic today today i'm in my mesa office it's been a little while since i broadcast it from here hopefully this sounds okay um i know last week when i listened back to the audio it was pretty bad so hopefully it's better this week tried to test it a little bit more before it went live uh if you have any questions today and have any estate planning questions go ahead and leave them in the comments i'd be happy to get your questions if if i can and anything estate planning related let me share my screen with you and let's get into it so before we talk about a trustee we first need to know what a trust is so a trust is a legal document prepared by a person which is called the trustor i use this briefcase to show the trust store meaning the boss sometimes the trust creator can be called the set lore or the trust maker the person that manages the trust is called the trustee and we use this green visor this green bookkeeper hat to signify the fiduciary who's in charge and the person in charge of a trust is called the trustee now the person that receives a benefit from the trust is called a beneficiary so we use this hand to symbolize that so a trust is a legal document where it names the successor trustee so who's going to manage things and who's going to receive things and under what conditions so now that we have the basic definition of a trust let's talk more about the trustee so it's going to be all about the trustee today that green visor all right so fiduciary a fiduciary is a person that's managing money for the benefit of another now in a trust that person's called the trustee so a lot of times the persons that create a trust they serve as a trustee they manage they manage the assets and the trust until they pass away or until their health declines and they're no longer able to manage things so you know in a last one testament the person in charge is called the personal representative and in a power of attorney the person in charge is called an agent all of those are examples of fiduciaries they all have that same green hat signifying that they're a fiduciary all right so before we talk about how you choose a trustee which is the topic i want to get into today today i want to talk about what the trustee does first so let's first get an idea and then we can talk trustee so if you are in a plan or area okay what to do is define the players so you have the decedent the fiduciary so who's in charge and the beneficiaries there could be multiple beneficiaries what is an estate it's everything a person owns whether alive or dead so the fiduciary is a person to whom power or property is entrusted for the benefit of another a last one the testament controls the assets inside of a person's estate and requires a probate to give the authority to that personal representative and the guardian i don't think we're going into all of this probate okay so if you're the fiduciary so after you've defined the players you figured out um so the next step is what are the assets so is there retirement accounts life insurance bank accounts real estate so figure out what what assets are out there and then what controls the assets what controls the assets so in a retirement account like a 401k or an ira it's common that you have a beneficiary you name a beneficiary that transfers those contracts so if there is a beneficiary listed if there's a person listed as a beneficiary then that's going to be controlling now um if there's no beneficiary listed then that goes back into the person's estate so this house it's showing that the title is the name of mrs estate the deceased she's deceased because she's kind of shadowed there and there's a trust all right so what are the assets and what controls the assets assets owned by a trust are going to be controlled by the trust assets titled in the name of the deceased are going to be controlled by their estate and if there's a beneficiary designation that's going to be controlling so the fiduciary they need to figure out what assets are out there what controls and then okay so if it's in the estate in the name of the deceased person if they have a last will and testament that will be controlling that will say who's in charge who's in charge is the personal representative and who the beneficiary is now what if the person did not leave a last woman testament then uncle sam's got you covered with the laws of intestate succession these determine who has priority to serve as a beneficiary and to serve as the personal representative of the estate and the trust will say who's in charge as the trustee and who the beneficiaries are all right so if you're the trustee after you figured out you know what the assets are what's controlling you'll need to start safeguarding the assets start collecting things and start accounting for them keeping keeping good records you want to collect all the assets determine and pay valid debts share an accounting with all the beneficiaries and then they'll so share an accounting and then divide all the assets so that's the big picture job of the trustee to do all of those things so how do you choose a trustee where do you find someone to to serve in this role in your plan most people start with a family member so that could be a sibling a parent or a relative someone that you trust to to manage money to manage your assets so i'd say most people probably choose a family member now what if you don't have a family member that you would trust in that position a child you could name a child an adult child they have to be over 18 in order for us to name them but even if they are 18 legally you can name them but it's usually not a good idea until they're a little bit older and then i caution against against um siblings managing for their other siblings i don't like i don't like the trustee being a sibling saying you know i can have my money right now but you have to wait or just that can cause some problems [Music] that's fine [Music] so there's um several children let's say there's seven or eight kids and the oldest is 18 and the other ones are younger um i i i don't usually like naming that that oldest child as the beneficiary i mean as the the trustee you can name a friend a trusted friend can serve in the position as trustee or you can name a professional company so if you name a company you can start looking at your financial advisor or where you bank at or where you hold your money you can see if they have a trust company um check with your cpa or accounting company see if they have provided those services it used to be more often that cpas would serve in that role but it seems less often and some of the older trusts i see they have a cpa named or but it's not as common anymore i think a lot of a lot of companies don't allow them so cpa companies may not allow for them to serve as the trustee or you could name your attorney you can see if your attorney is willing to serve as the trustee in your plan oops okay so if you choose a bank let me stop sharing a little bit all right if you choose a bank or a company what you need to look out for is is number one you want to get an idea of what their fees are and and also what kind of service they're going to deliver do they have a local office or what kind of experience are your kids going to have i know i know some major banks the the trust office is in texas for like all of the west coast so there's there's not a lot of service and they don't they can't give you a lot of local help these um some of these big banks and big institutions if they don't have local offices and local services so that's one thing to consider you know what kind of experience they're gonna have and then it's also just how much do you trust this bank how much do you trust this institution they have their policies today they may lure you in with even um you know low low trustee fees today i've heard of some of the big brokerage companies even saying free free trustee fees that they'll serve for free as a trustee but there's always a fee somewhere is is what i want you guys to look at and consider so if you're if you're naming one of these services as the trustee and they're they're doing it for free what are they looking for you know they're they're gonna make money somehow they're definitely gonna make it somehow so even though the the trustee service may be free or maybe low cost they're gonna make it up in management fees or or some other place the other thing it's kind of it's been in the news big lately is um you know robin hood is an example of of a bank where they're not they're not really a bank but they just stop selling stocks all of a sudden now it may be because of um because of limits that they reached or maybe other factors which it kind of seems like like it may be that they were shutting down selling stocks to help out their hedge fund friends from the prices cup uh from the prices being run up any higher so you know that that kind of just shows you it's an example of be cautious of the financial institutions you choose and just realize if you choose them they could change the policies later so i want to show you our our fee schedule from alt legal so we do have a fiduciary services company so if you would like to name a lot of people been asking me if they can name me or my company as a successor trustee and for a while i was like no no no i'm not going to do it not going to do it and then after several requests i finally threw my hat in the ring and started offering the fiduciary services so when clients are looking for trustee choices i can show them our our services through mott legal and then they can compare that to to other places now the advantage of naming us naming not legal is we're attorneys we can do the legal work we have experience that way whereas the banks and financial institutions since they manage money that's that's really their benefit they can help manage your money so our feast and you're looking at trustees this is important state settlement services so next we're going to talk about trustee fees but first estate settlement services so what estate settlement services is is um so my legal is named as a successor trustee and they start serving on the death or disability of the last trust store so estate settlement is the process of of being appointed as a trustee and then distributing all of the assets so this is going to be the highest level of fee and this fee is based on a year and it's based on the size of the assets and the trust um and that's just the best way to estimate how big the job's going to be this is the way that most banks and companies do it so the the fee for the first half million is three and a half percent that's that's what we charge and then for the next half million the view goes down and then it keeps going down so this is this is the state settlement services and now trustee services this is when serving as trustee of a trust that has already been administered or in the second and subs subsequent years of a state administration so for example if you name us to serve as a trustee of your trust and you want us to manage it until your children turn 30 and they're age 25 when you pass away so the fee for year one would be this to set everything up and then year two for the individual trust it's gonna be one percent of the first half million and then a half percent of the next two and a half million so the the fees for trustee services is quite a bit less than the estate administration so if you're comparing trustee services if you're if you're looking at banks and financial institutions and asking them how much they charge for those services you'll want to distinguish between those two things i've seen a lot of places they quote this fee whereas it's actually a higher fee for the estate administration personal representative services this is if someone names us to be the personal representative of the estate so if there's assets titled in the name of the deceased person um if we do it right we don't have a pr we don't have an estate we avoid probate as long as everything's transferred in the name of the trust that avoids probates so there is some other other expenses as well as part of the trustee services if we have to sell property and if there's multiple beneficiaries and things like that so um trustee services if you're um if you're looking at different options you know we you know you can name us and we have a conflict waiver we have to disclose that the interest uh disclose that i own mott legal and dana and associates it's just making that clear for people that that decide to choose us as the trustee so all right so so that's what i want to talk about about trustees so what they do how you find them so when you're when you're designing your own plan think in terms of the best person right now or the best company right now and then estate planning it's not something that you do just once and you're you never have to look at it again we recommend about every three to five years that you review your plan or if there's a major law change or major tax change it's also a good idea to change your plan so think in terms of the best best person to serve as a trustee right now and just know that in another five years you can look at it and address it again and see if the the person you chose or the company that you chose they still align with what you would want from a trustee thanks everyone thanks for tuning in i'll put up some some banners here so you can schedule a free what we call personal family legal session if you want to get started on your own estate planning to create a trust for your family make sure they're protected from probate and those extra stresses extra costs and extra fees so you can give us a call today shoot us an email send us a text and we can get you set up to meet with myself or one of our other attorneys to help design a plan for you thank you