Updated: Jan 11, 2023
Handling administrations of estates is one of the duties of Executors and Trustees of the last will and Trusts. The normal practice is to use your family members and friends to look after probate administration and trust settlements. However, using them may not always be feasible, and you may need to hire an executor, trustee, or guardian from a corporate trust company. There are pros and cons you should know before making decisions about employing a corporate trustee.
A corporate trustee comes with skills, knowledge, and experience, which are a corporate trustee main benefits.
Continuous and dedicated support is possible with corporate trustees as you do not need to worry about administrations of your estates due to executors' or trustees' unavailability, mental incapacity or death .
Estate planning becomes easy because you will not need to look after legal, tax, or other requirements.
Most trust companies manage the investment portfolio and your estate plan, which helps further streamline your investment strategy.
Corporate trustees manage expirations and updates so that you will be free from those hassles.
If you have large assets that are not manageable, then it is worthwhile to hire a corporate trustee.
Using a corporate trustee will relieve you from potential family trustees and executors who may create issues due to personal motives. Corporate trustee is independent party and so, such issues cannot arise.
Corporate trustees are a good choice for those with diversified portfolios nationally and internationally. It's difficult to manage estate planning in such situations because you may need extraordinary estate planning support, which you can not manage yourself.
Corporate trustees do not come without cost. Most of the time, they are expensive, so it may not be feasible if you do not own substantial wealth that requires professional management.
Corporate trustees come with customized terms and policies that you need to comply with otherwise, you may get penalized with unnecessary fees.
Corporate trustees may not provide support as you may require sometimes. For example, they may be overqualified to manage your small portfolios and estate planning needs.
You may sometimes need a bigger estate plan but working with corporate trustees, you need to get accept some of the promotions and advance products that you may not need.
Your oversight of what is going on with Estate planning would be less, and so, in the future, it will be difficult to manage if you cannot afford corporate trustees.
Choosing the right corporate trustees is a big challenge, especially for Islamic estate planning. Not many corporate trustee companies are familiar with Islamic laws, which may ruin the estate planning goals.
Corporate trustees may require unnecessary formalities and form filling to accomplish contracts which will be an extra cost for no reason.