Situation

Payton owns a successful e-commerce business. She’s a single mother of two who is very active in her children’s lives while also taking care of her elderly father. She is the trustee of two trusts established by her mother for her two siblings. Although she has no independent knowledge of trusts or investments, she has a good relationship with her J.P. Morgan team who guides her through her investment needs. 

Payton has tried to gather assets and figure out how to manage it all, but she worries that she may not be able to dedicate the time and attention needed for appropriate oversight. Payton also has a slightly strained relationship with her brothers, and their unhappiness over her being in charge of “their money” has added to her frustrations.   

Our Approach

Payton spoke with her J.P. Morgan team and expressed her concern over managing all the responsibilities. Her banker acknowledged that being a trustee is a great deal of work, and asked her if she would like to have a trust officer join an upcoming meeting. During the meeting, the trust officer explained all the administrative responsibilities including asset collection, management, discretionary distributions, tax reporting and beneficiary notification—as well as how J.P. Morgan could help. Bringing on J.P. Morgan as co-trustee or agent would ensure that Payton remained involved, as her mother wanted, while at the same time allowing J.P. Morgan to do the heavy lifting on the more technical aspects of trust administration and take the lead in evaluating distribution requests from her brothers.

Outcome

Payton was relieved that she could stay actively informed and participate in major trust decisions, while escaping the stress of handling the day-to-day administrative tasks. Having a neutral party serve as an intermediary with her brothers allowed their relationships to improve while still ensuring proper trust administration.   

Before you name a family member as a trustee, consider these questions:

• Do you and your family member understand the impact that acting as a trustee can have?
• Is your loved one on board with being legally responsible and personally liable?
• Is your family member familiar enough with the financial assets to make or oversee financial investment decisions?
• Does your family member have sufficient legal expertise to accurately interpret and understand your trust agreement in order to properly fulfill your wishes and your legacy?