Preparing to administer a trust

On Behalf of | Jul 18, 2024 | Estate And Trust Administration

Administering a trust is a significant responsibility. If you are getting ready to administer a trust, you’ll be entrusted to properly manage and distribute trust assets according to the terms set by the trust’s creator (the grantor). 

As a trustee, you are a fiduciary, meaning you have a legal obligation to act in the best interests of the beneficiaries. This expectation should influence all that you do. For example, you’ll need to act in their best interests – not your own – as you are:

  • Managing assets: You’re expected to safeguard and properly manage the trust assets, which might involve investing funds, maintaining property and working to ensure that assets are not wasted or misused.
  • Distributing assets: You’ll need to follow directions carefully, as you distribute the trust assets to beneficiaries as specified in the trust document.
  • Keeping records: You’ll also need to maintain detailed records of all transactions, including income, expenses and distributions.
  • Communicating with beneficiaries: You’ll also need to provide regular updates to beneficiaries about the status of the trust and respond to their inquiries.

As a general rule of thumb, however, whenever you’re navigating trust administration duties, you’ll want to act with the best interests of the trust’s beneficiaries at the absolute forefront of your mind. 

Getting started

Before you can effectively embrace your role as a trust administrator, you’ll need to thoroughly review the trust document in question, in order to understand the grantor’s instructions. Pay special attention to:

  • Terms and conditions: Specific provisions regarding how and when assets should be distributed.
  • Trustee powers: The extent of your authority to make decisions, such as investing assets or selling property.
  • Beneficiary rights: The rights of the beneficiaries, including any special conditions that must be met for them to receive distributions.

If you are unsure about what anything in the trust document means, or how you should manage its terms, do not panic. Seeking personalized legal feedback is always an option.