Overview Trust Administration Basics of Trusts Benefits of Trusts Responsibilities of a Trustee Choose a Trustee Discretionary Decisions Fees Estate Planning & Settlement Investment Management Investment Process Stock Selection Buy/Sell Mutual Funds & ETFs Unique Asset Management How do I choose a Trustee? The role of a Trustee The role of a Trustee is central to carrying out the provisions of an estate plan. A Trustee is required by law to administer a trust in good faith, in accordance with the terms and provisions of the trust, and solely in the best interests of the beneficiaries. The Trustee must be impartial in investing, managing, and distributing trust property; giving due regard to the provisions of the trust and the respective needs of the beneficiaries. The Trustee must administer the trust as a prudent person would and in doing so must exercise reasonable care, skill, and caution. The Trustee is required to periodically furnish complete accountings to beneficiaries with respect to trust transactions and trust assets. Who may serve as Trustee You may designate as Trustee any person or a corporate trustee, such as First Nebraska Trust Company, in whom you have confidence that the role and duties of Trustee will be promptly and faithfully discharged in accordance with the provisions you have set forth in the trust agreement. Depending on the nature of the trust and any tax planning involved, you may be able to be your own Trustee until you want to relinquish the responsibility to a named successor trustee. A Trustee will normally be one of the following: Yourself A Spouse, or trusted Child, Relative, or Friend A Corporate Trustee such as First Nebraska Trust Company It is always advisable to appoint a Successor Trustee or series of successor Trustees, especially when individual Trustees are chosen, to ensure that should something happen to the health or decision making ability of the serving Trustee you have the assurance that your financial matters and wishes expressed in the trust agreement will continue to be carried out without the necessity of taking legal action in a court. Trust agreements will frequently provide a method for removal and replacement of Trustees by beneficiaries or others as a method of oversight should a Trustee not be properly carrying out the duties of the Trustee. Characteristics of a good Trustee Here are some characteristics to consider when choosing a Trustee: Confidence in the Trustee’s honesty, integrity as well as experience and skill in trust and asset management The Trustee’s willingness to learn about you personally, your family or other beneficiaries and the how and why of the manner in which you are providing for them, and to become familiar with your financial matters Accountability and willingness to follow your instructions set out in your Trust Expertise in managing and investing your assets Why choose a corporate trustee like First Nebraska Trust? Highly trained professionals with expertise in trust management and administration inclusive of all accounting and reporting functions to beneficiaries Impartial / independent decision making Accountable and responsible for Trust assets and Trust administration Investment practices commensurate with your goals to ensure long-term financial security within the trust and for beneficiaries Possible creditor protection or a safety net for beneficiaries who have not demonstrated financial responsibility Bonded and subject to annual examination by the Nebraska Department of Banking and Finance as well as its own internal audit of accounts Avoid burdening your loved ones and creating potential divisiveness among family members Your loved ones will need time and space to grieve your loss without adding extra financial and legal responsibilities to their lives. Your loved ones want to continue to maintain positive and loving relationships within the family without adding additional layers of complexity by being held responsible and accountable for financial and legal matters for the rest of their family members. Time, ability and interest – Your loved ones have their lives and careers and other responsibilities which keep them busy day-to-day. It is often overwhelming for family members to be placed in the role of a Trustee and the added pressure in managing, informing, and making fiduciary decisions. It is extremely important that your chosen Trustee has the necessary time, expertise, interest and resources to be able to fulfill the role and responsibilities as your chosen trustee Family dynamics – a family member as Trustee may resent what are entirely appropriate questions from other family members about the status of matters. A family member is entitled to a reasonable fee for the responsibilities assumed and regardless of the fee charged there are likely other family members who will think it is too much. Family members will generally have no experience in carrying out the responsibilities of a trustee and this could result in delays, inappropriate actions, and more reliance on legal and accounting advisors. If errors are made or if any type of overreaching or acting out of self interest should occur, you do not want family members suing family members. Other fiduciary positions: The preceding provisions focus on the position of a Trustee in an estate plan. A Trustee is also called a “fiduciary” which is frequently defined as one who occupies a position of such power and confidence with regard to the property of another that the law requires the fiduciary to act solely in the interests of the person and beneficiaries the fiduciary represents. This term “fiduciary” also is used to refer to the role of one who is appointed as personal representative in a will or as an agent to act under a power of attorney. Consequently, the selection of a personal representative in your will or an agent to act under your power of attorney should be subject to the same considerations discussed above.