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Understanding the Role of a Trust Advisor in Your Estate Plan

The Role and Benefits of a Trust Advisor in Your Estate Plan

When it comes to estate planning, ensuring that your wishes are honored and your assets are managed appropriately can be a complex and daunting task. One way to add a layer of protection and oversight to your trust is by appointing a trust advisor. 

What is a Trust Advisor?

A trust advisor is a person or entity appointed to oversee and guide the administration of a trust. Your trust advisor needs to be an independent third party – they may not be a minor or anyone who could potentially be a beneficiary or trustee of your trust.  While the Trust Advisor does not manage the trust's day-to-day operations, they have the authority to intervene in specific situations to ensure that the trustee is acting in accordance with the grantor’s intentions and the beneficiaries' best interests. 

The scope of a trust advisor’s powers can vary widely depending on the terms outlined in the trust document, but generally, their responsibilities may include:

  • Removing and appointing trustees: If a trustee is not performing their duties adequately, the trust advisor can remove them and appoint a new trustee.
  • Modifying trust terms: They can amend the trust terms to adapt to changes in law or circumstances that affect the trust.
  • Approving distributions: They may have the authority to approve or disapprove distributions to beneficiaries.
  • Resolving disputes: They can help resolve conflicts between trustees and beneficiaries or among beneficiaries themselves.
  • Providing guidance: They offer general advice to trustees on managing trust assets and adhering to the trust’s objectives.

Benefits of Naming a Trust Advisor

  1. Enhanced Oversight and Accountability: A trust advisor adds an additional layer of oversight, ensuring that trustees adhere to their fiduciary duties. This can be particularly important in complex trusts or when significant assets are involved. The trust advisor acts as a watchdog, holding trustees accountable for their actions and decisions.
  2. Flexibility and Adaptability: Circumstances and laws can change over time, necessitating adjustments to the trust terms. A trust advisor can make these adjustments without going through a lengthy court process, ensuring that the trust remains effective and relevant.
  3. Conflict Resolution: Disputes between beneficiaries and trustees can be disruptive and costly. A trust advisor can mediate these conflicts, providing an impartial perspective and helping to maintain family harmony. Their involvement can prevent litigation and preserve the trust’s assets.

Incorporating a trust advisor into your estate plan can provide peace of mind, knowing that an experienced and impartial individual will oversee the administration of your trust. This role can help ensure that your wishes are honored, your assets are managed effectively, and your beneficiaries’ interests are protected.