We think the corporate co-trustee arrangement is an ideal solution for families with wealth. In this arrangement, a family member or individual shares the responsibility of trusteeship with a corporate trustee like Cumberland Trust.
Typically, naming a corporate trustee to serve as trustee or co-trustee provides many more client protections than utilizing a sole individual trustee.
Here are some of the ways a corporate trustee or co-trustee can provide additional protection:
Regulation
Trust companies are monitored by independent and government entities. This promotes effective implementation of processes and procedures and compliance with applicable regulations.
Checks and Balances
Many corporate trustees like Cumberland Trust operate as a “directed trustee,” allowing the grantor or the beneficiaries to use their preferred financial advisor to handle the investment management of the trust’s liquid assets.
When utilizing a directed trustee, any conflict of interest that can exist when a trustee also manages the assets of the trust is eliminated. Under this model, financial advisory firms can add an additional layer of safeguards to trust accounts by overseeing invested assets and account activity.
Record-keeping
Serving as trustee or co-trustee for a family is an important job that requires a great deal of bookkeeping and many administrative duties, which trust companies are better equipped to undertake. Trust companies often have more standardized record-keeping and reporting practices in place which ensures various aspects of administration of the account are carried out and accurately documented.
A corporate trustee or co-trustee can help clients feel confident that their trust and estate accounts are protected.
To learn more about The Case for the Corporate Co-Trustee, see our other articles in this series:
The Case for Corporate Co-Trustees
The Case for the Corporate Co-Trustee: Maintaining Family Harmony
The Case for the Corporate Co-Trustee: Continuity for your Family
The Case for the Corporate Co-Trustee: Modern Family Dynamics