What does Successor Trustee mean?
A successor trustee is a person (or group of people) that takes over the management of a living trust (or a trust of any kind) when the original trustee has died, become incapacitated or is unable to act as the trustee. The successor trustee is typically named by the Grantor / Settlor (the person who created the trust) of the trust in the trust documents. The responsibilities of a successor trustee may also be specified in the language of the trust documents. The Settlor may name several successor trustee(s) in case one or more is unable to act as the trustee. In some cases a professional such as an attorney, fiduciary or trust company is named as the successor trustee.
Is a Successor Trustee and Trust Administrator the same thing?
Yes, typically when someone refers to a person as a Trustee or a Trust Administrator, they are referring to the same person. The trustee or successor trustee acts as the administrator of a trust.
Does a Successor Trustee have to be a relative?
No, a successor trustee does not have to be a relative of the Settlor. Commonly the Settlor chooses a relative such as a spouse, son, daughter, brother or sister to be their Successor Trustee, but it is also not uncommon for them to select an attorney, CPA, or licensed fiduciary.
Does a Successor Trustee get paid for their work?
Yes, in some cases a Successor Trustee or Trust Administrator receives payment for the work they do on behalf of the trust and the trust beneficiaries. Usually this occurs when the Successor Trustee is a professional such as a lawyer, licensed fiduciary or accountant. When the person serving as the Successor Trustee is a family member, it is common for them to decline compensation for the work they do on behalf of the trust. Trust Administration or Trustee compensation varies depending on the qualifications of the person, but annual compensation does not typically exceed 2% of the total trust assets.
Thanks for explaining that!
Does a successor trustee need to have any type of certification to perform that role?
Thanks for your question Tina. No, to be a trustee or successor trustee you are not required to have any certification or license. Sometimes when creating a living trust, the Settlor will opt to select a professional like an estate planning attorney as their successor trustee, but that is simply preference.
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