Establishing a trust is one way to preserve assets, protect your loved ones, and ensure that your legacy is passed on as intended. Unfortunately, setting up a trust is not always easy for those who have no experience with the process. More importantly, maintaining the trust can quickly become a challenge unless the proper person is appointed. If you are considering creating a trust for a loved one, you must find ways to avoid common trust administration problems that could negatively affect your beneficiaries.
Comply With All Laws
Obeying the law might seem like common sense advice, but a person with no knowledge of trust establishment or administration may be unknowingly breaking laws. Once a trust administrator is accused or found guilty of breaking laws, the assets being managed could be compromised. Making sure the person chosen to administer the trust you establish is aware of current laws and is prepared to ensure compliance is the first step to making sure your heirs do not encounter problems.
Consider More Than One Administrator
Some assume that they can only appoint one person as administrator. In reality, it is possible to appoint more than one person or rely on an entire law firm. Choosing more than one person means you can benefit from the experience of multiple people or professionals. It also potentially reduces the chances of asset mismanagement by creating a natural system of checks and balances between two or more people.
Communication is one of the most important aspects of successful trust administration. The beneficiary of the estate is dependent upon the administrator for information and updates regarding the estate. Failing to notify the beneficiary of changes, not providing basic information, or forgetting to get back in touch with the beneficiaries if they reach out with questions can all lead to major issues. The administrator must always communicate with the beneficiaries and if they are unable to do so then they might not be the best choice for the task.
Make Sure the Trust is Valid
One issue that occurs occasionally is that the trust’s validity is challenged by the beneficiaries or other parties. If the trust was not established correctly or there are questions surrounding the distribution of the estate, your heirs could find themselves battling to hold onto their assets. Legal battles caused by trusts being challenged quickly become expensive and can drain an estate, leaving every party involved unsatisfied or in debt. If it is determined that the trust is valid but the beneficiaries were not notified in a timely manner by the administrator, then that could lead to another legal fight to get the administrator replaced.
Rely on an Expert
When the time to establish a trust comes, it is best to talk to the attorneys at a law firm that has experience with the administration of trusts. The team at MMZ Law is prepared to meet your trust administration needs and make sure that your assets are distributed in the manner you outlined in your estate plan. If you are prepared to begin discussing what type of trust you need and how you would like the funds to be managed, contact us today to schedule an initial consultation. Conveniently located in Claremont, California, our trust administration lawyers are here to help with all of your legal needs.
BROUGHT TO YOU BY:
MMZ LAW, A PROFESSIONAL CORPORATION
341 W. 1st St. Suite 100
Claremont, CA 91711
MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.
This information is educational information only and not legal advice.