Are there any trustee companies you would recommend and why?

We received this question after presenting a webinar, and it’s something that clients without family or friends to appoint to key roles in their estate planning realise that have a lot of choice over. So we wanted to share our answer here on our blog too!

I really love this question, and the reason is that it is a very big reality and often a barrier to clients seeking advice that they don’t have anyone personally close to them as a family member or friend who would be suitable to act as a professional executor, trustee, or indeed attorney (if we are contemplating incapacity but still being alive as well).

There are many reasons why it would appropriate for a client to appoint a professional, and in some cases I see these appointments being overused and really eligible children being bypassed because the lawyer or trustee company suggested it at the time.  And other times I see it being underused; such as where we can reasonably anticipate that there will be an estate dispute between beneficiaries, where children cannot get along, or there are complex business or asset structures that mean a professional with sophisticated knowledge will ensure better outcomes.

That said, in my ten years as a lawyer I have never appointed a trustee company for a client.  Instead, I’d like to share what I recommend to my clients who are in this situation.

We firstly explore the option of the family member or friends in their lives who may be appropriate.  If there are some concerns about certain aspects of the role that they will need to perform, we consider all of the conditions or limitations, or strategies such as appointing them as a co-controller with a professional before we disregard and pass them over altogether.  A child may not be suitable to manage your money on their own (as attorney or executor), but we can discuss strategies where we enable them to perform the role to the full extent of their ability.  Perhaps that means the family member or friend are an attorney acting together with a professional; that way they can be the one who takes you shopping, or to the bank, or makes centrelink calls with you, or clears and sorts your home and personal possessions after death, and organises your funeral.  These are low risk tasks that would be expensive if the sole domain of a professional.  But maybe the large financial decisions must be done jointly with the professional.  This will ensure that you have someone “on the ground” and who knows you working in your best interest, together with a professional as the decision maker with the skills that will protect against a client’s greatest concerns.

I believe that one of the barriers to people starting estate planning when it is likely that they will need to appoint a professional, is that they feel shame or sadness that they don’t have the support of family or friends that they deserve as they age.  And also that they do not want to burden others.  If the concern is about being a burden, my recommendation is that before a family member or friend is passed over a scope of work is determined with the estate planning lawyer, and the proposal is put to that person.  I am especially in favour of paying attorneys and executors for their time if appropriate in the circumstances, and if cashflow is an issue discussing with the attorney about being paid for their role from the proceeds of the estate.

For my clients who do need a professional, or a mix of personal and professionals acting together instead of using a company I am familiar with the lawyers in my area who frequently accept attorney and executor appointments (and are often chosen by the courts to act as well) and allow my clients to choose who they would like an introduction to.  Most of these lawyers offer my client a free 30-60 minute meeting to learn about their personal circumstances, and understand why they want and need a professional before agreeing that there is a good fit (or otherwise) and allowing us to appoint them in the documents.  The benefit of this to clients is that they can meet the professional and convey their wishes and values to them, they can be assured that when the time comes for them to act that they know who will be acting (with contingencies of course).  These lawyers who have built this as part of their practice have charging systems that are always compliant with the court requirements, and are not commission based (which penalises the richer clients to subsidise the smaller estates), and they maintain case loads that will allow them to give you and your matter the attention required at the time.

The main point that readers should take away is that if they are delaying putting in place an estate plan because they are not confident of who to choose, that your estate planning lawyer should be able to support you.  There is a whole spectrum of solutions between “appointing your next of kin and hoping for the best” vs “appointing a trustee company and paying commission”.