Everyone knows that a trust needs a trustee to manage a trust, but not everyone knows that it is also possible to create another position with a trust that has oversight authority over the trustee.
One of the keys to creating an effective trust is to make sure that the designated trustee is knowledgeable, honest and capable. However, even with the best research into possible trustees it is not always possible to pick the right person ahead of time.
It is always still possible that the trustee and the beneficiaries will not see eye to eye, which could result in conflicts. It is also not always possible to predict how changes in the law might affect the trust and make it desirable to change the terms.
Because of these possibilities some people choose to designate someone to be a trust protector as the Yuma Sun discusses in “Estate Planning: Who oversees a trust administration?”
Basically, a trust protector is someone who has the authority to make decisions concerning the trust in the event there is conflict between the trustee and the beneficiaries. Trust protectors can also be given other powers if desired, such as the ability to modify trust terms under certain circumstances.
In essence, the trust protector stands in for the creator of the trust and seeks to ensure that the trust operates properly.
If you would like to learn more about a trust protector and whether you should appoint one for your trust, discuss it with your estate planning attorney. The attorney can walk you through the pros and cons of trust protectors.
Reference: Yuma Sun (Aug. 8, 2016) “Estate Planning: Who oversees a trust administration?”
