When the Successor Trustee Steps In
- Death: When the trust creator dies, the successor trustee manages the estate. They pay final expenses and distribute assets per the trust's instructions.
- Incapacity: If the trust creator cannot manage their own affairs, the successor trustee steps in. This requires a physician's letter and HIPAA authorization.
- Resignation: If the trustee voluntarily steps down, the successor trustee takes the role.
Choosing the Right Successor Trustee
The successor trustee should be trustworthy, organized, and willing to serve. Many people name an adult child, a sibling, or a close friend. Banks and trust companies can serve as corporate trustees for families without a suitable person.
The successor trustee owes a fiduciary duty to the beneficiaries. They must act in the beneficiaries' best interest, keep accurate records, and avoid self-dealing.