Thursday, November 5, 2015

Trustee Is Duty Bound

Agnes has learned that she has just as much power to take care of her property as trustee of her own living trust as she did when she owned that property simply as herself.  It also means that she can later allow either or both of her adult children take over managing her property later if she wants to, by naming them her successor trustee. 

She could later resign as trustee so her son John, who she named to serve first, could take over managing her rental property and other finances. Then, John would have the legal authority to buy or sell, mortgage, hold, or use any of her assets just as Agnes did when she served as trustee.  John could sign a deed to sell one of her rental properties, as trustee.

But there is an important difference.  John must make all management decisions for the benefit of Agnes only as long as she is alive.  Even though Agnes resigned being trustee, she is still the beneficiary of the trust for her lifetime.  So, as her trustee, John is duty-bound to act only for her interests.

If at the time Agnes stops being trustee, John is unable or unwilling to be trustee, Agnes has named her daughter Betty to serve as the backup trustee. 

For advice about living trusts or wills for yourself or someone you know who needs help with estate planning, call our office at (815)436-1996 to receive free informational brochures or to set an appointment for individualized analysis of your specific situation. 

©2015 Gruber Law Office, Ltd.

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