The idea behind the Protector is to have somebody who can watch over the Trustee, and terminate the Trustee for any misconduct.
When you think of a trust, you commonly think of three parties involved: the trustmaker, the trustee, and the beneficiary. But what if you’re not sure you can “trust” the trustee? Enter the “trust protector.”
So, what is a trust protector and ought you to consider one? Even if you are considering a simple trust arrangement, it is worth reading a recent Forbes article titled “Trust Protectors — What They Are And Why Probably Every Trust Should Have One.” The article offers a compelling case for the inclusion of trust protectors specifically, but offers a great deal of information – and diagrams – about trust arrangements in general.
Even if you already are savvy on trusts, why would you want to consider adding another role and another hand in the process? While there are many reasons, one constant is the perennial problem of the untrustworthy trustee. Should that ever happen, then a trust protector is made to order.
In practical terms, the trust protector is an individual (or even a team of individuals) who assumes little in the way of day-to-day administration of the trust, but does assume higher powers over the trustee who does perform such functions. Result? The trust protector can fire the trustee, if they get out of line. You may find comfort in adding a trust protector to the mix as a way to protect your beneficiaries and guard over your assets.
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Reference: Forbes (August 25, 2012) “Trust Protectors — What They Are And Why Probably Every Trust Should Have One”