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Choosing Your Trustee

Choosing a trustee is one of the most important decisions you will make. Covenant Trust Company^® provides professional trustee services and asset management, and is an excellent choice to serve as trustee of your revocable or irrevocable trust, or IRA account. [view full text of Choosing Your Trustee]

The basic choice is whether to choose a corporate or an individual trustee. We believe that in almost all cases, the corporate trustee is a better long-term choice; and we are well-equipped to provide this service for you.  Occasionally, some individuals choose to serve as trustee initially, naming Covenant Trust Company as successor trustee. There are significant responsibilities in being a trustee. Providing quality trustee service requires expertise and knowledge that individuals may not always possess. The consequences of inadequate or incompetent trustee services can be significant to all parties involved.

The trustee has specific duties:

• Take possession of and maintain control of fiduciary [trust] assets

• Collect amounts due and pay expenses
  

• Keep fiduciary assets separate and distinct from all other assets
  

• Maintain clear and accurate accounts and records; provide regular accounting of actions as trustee
  

• Exercise the same care and skill in administering the trust as a person of ordinary prudence would exercise in dealing with his/her own personal property
  

• Administer the trust solely in the interest of the beneficiary(ies)
  

• Valuation of assets for tax purposes, insurance, sale, disposition, performance measurement and capital gain reporting
  

• Payment of estate, inheritance and income taxes
  

• Investment of trust/estate portfolio
  

• Administer the trust in adherence to the provisions of the trust document

• Violation of any applicable law
  
• Non-compliance with the terms of the trust or any applicable court orders
  
• Failure to properly discharge any of its duties or responsibilities
  
• Abuses of any trustee powers

• Imprudent management of account investments [e.g. poor investment decisions]
  
• Failure to manage cash appropriately
  
• Engaging in self-dealing or other conflicts of interest
  
• Failure to properly manage real property [e.g. failing to have proper insurance, to pay taxes, etc.]
  
• Mismanagement of trust accounts or funds [e.g. making improper or unauthorized distributions]
  
• Improper delegation of duties [e.g. no oversight of investment manager, or property manager]
  
• Taking actions without approval of beneficiaries, co-fiduciaries, or a court with jurisdiction