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| Trusts |
Ties that Bind
Michael Sisk
01/01/2004
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In the quest for more personalized attention, some of us turn to an independent, private, professional fiduciary. These two- or three-person outfits place a high premium on service, attempting to bridge the gap between the personal contact and understanding of an individual trustee and the expertise and impartiality characteristic of their corporate counterparts. Phillip H. Banks founded his La Mesa, Calif.-based Banks & Banks Fiduciary Service in 1980 after finally succumbing to the frustrations of juggling the demands of the large bank trust operation where he worked. His last position with Bank of America placed 300 clients under his care. "I suggest that that [number] is well beyond what is reasonable," he says. "Clients were so frustrated by the absence of service. But there just wasn’t time."
Professional independent trustees such as Banks are unregulated, however, so thorough background checks prior to retaining one are de rigueur. "There’s not a designation, and that’s an area of concern, though California is starting to have registration," Banks says. "You need to do your due diligence on their education, background and credentials."| Five essential questions to ask when choosing between an individual and corporate trustee: | | 1. Does the individual have the expertise to manage the financial and legal issues that will arise, or will he have to hire outside advisors? | | 2. Will the trust outlive an individual trustee and, if so, how will successors be appointed? | | 3. How much attention will the beneficiaries need? Can a corporate trustee provide enough personalized attention? | | 4. Will the trust raise contentious issues among family beneficiaries that would best be decided by an objective corporate trustee? | | 5. Will the cost of advisors hired by an individual trustee exceed the fees charged by a corporate trustee? |
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