A special needs trust requires the support of a trustee. The person chosen to administer the trust manages assets and makes distributions in accordance with the terms of the trust documents.
Those funding a special needs trust need to consider their options carefully when naming an individual to manage resources for a beneficiary with special needs. What are some of the options for appointing a trustee?
1. A close family member or friend
Choosing an individual who knows the beneficiary can be a smart move. They can provide both practical and social support to the beneficiary, and their relationship may reduce the likelihood of financial misconduct. Choosing someone who cares about the beneficiary to serve as trustee is often the simplest solution.
2. Two or more co-trustees
Perhaps the family member closest to the special needs beneficiary has a history of substance abuse. Maybe they struggle to keep a job. In cases where the best candidate might face challenging personal circumstances, trustors may choose to appoint two or even more people as co-trustees. Co-trustees can monitor one another’s conduct and reduce the likelihood of embezzlement or incompetent asset management.
3. Professional fiduciaries
Attorneys and other professionals can serve as fiduciaries for the purposes of trust administration. They can provide long-term support over many years. Professional trustees are an excellent option for those providing support for a particularly young beneficiary or those with limited family connections.
Naming the right trustee to administer a special needs trust is critical for the future protection of the beneficiary. Parents and other trustors may need help as they evaluate their options when establishing a trust. Having experienced estate planning guidance can be crucial.