This post is exclusive to active Land Trust University students.
In the Land Trust training classes I teach around the country, I am asked often, “Which is better, a corporate or an individual Trustee?” As with most issues in life, it depends. There are advantages and disadvantages with both types of Land Trust Trustees. Let us review what I cover in detail in my Land Trusts Made Simple® Home Study Course.
- Have professional liability insurance (They have Errors and Omissions insurance)
- Are diligent in their record-keeping
- Require the proper documentation to complete their responsibilities as set forth in the Trust Agreement (This keeps you on track when directing the Trustee to take action)
- Have multiple Trust Officers in-house that are qualified to respond to your needs
- Are subject to many levels of oversight from internal auditors, outside auditors, and government regulators.
- Are “open for business” 24 hours a day (never close for holidays or weekends)
- Cannot be easily located (which makes it very difficult to serve them a lawsuit on behalf of the trust)
- Typically have lower fees than corporate trustees
- Will not disclose the beneficiary as easy as a Corporate Trustee
- Allow for quickly changing the Trustee duties to a different Trustee in another jurisdiction
One solution to the question, “Do I use a Corporate Trustee or an Individual Trustee?” is to use them both! Yes, you can have a Board of Trustees helping to operate your Land Trust. It is possible to divide the duties required by the Trust Agreement between multiple Trustees. Admittedly, this complicates the management of your Trust, but it may be what you want to safeguard the Trust’s assets.
The Beauty of the Land Trust is its Flexibility
As shown above, you can create just about any scenario you want/need to accomplish your goals. Furthermore, you can pass on your knowledge and experience to your children by allowing them to participate in trust administration. Assuming your child has a different last name than you (perhaps a married daughter), she could serve as sole Trustee or on a Board of Trustees to garner valuable experience for the day when she inherits your trust assets. The options are endless and only limited to your creative thinking.
Remember, choose your Trustee wisely and know that if you make a mistake it will be easy to change your Trustee with the stroke of your pen!