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What are some important considerations when choosing a successor trustee?

The Private Bank, Union Bank, N.A.Maricella Solorzano, Vice President and Senior Trust Officer

Los Angeles, CA Leading Wealth Advisor

Ensuring your plans are executed according to your wishes is an important consideration for wealthy individuals. As such, a great deal of attention is paid to the importance of having a will or well-written trust document so your assets can be dis-tributed as you designate. While this is a critical step, of equal importance is choosing a successor trustee—the per-son or entity that will carry out those wishes on your behalf.

Successor trustees are held to a fiduciary standard. This means they are required by law to be the caretaker of the grantor’s rights, assets and/or well-being and will carry out those responsibilities with the utmost degree of care, honesty and loyalty. As a result, many grantors automatically default to family members or other trusted individuals when selecting a succes-sor trustee. While on the surface this might appear to be the logical choice, choosing an individual as a trustee can create unexpected consequences.

Depending upon the value or com-position of the assets held in a trust, acting as successor trustee can become very complex. The trustee must ensure all assets in the trust are administered appropriately and will be responsible for record-keeping, the filing of tax returns, prudent investment decisions and communications with beneficiaries.

For many individuals, these duties are extremely time consuming and beyond their abilities. Additionally, the suc-cessor trustee is personally liable to all of the beneficiaries if he breaches his responsibility, whether that occurs intentionally or not. As with most mat-ters involving money, tensions can run high and it is easy for the trustee to become embroiled in family politics or even accusations of malfeasance.

To help protect friends and family from this potential liability, more and more wealthy individuals are seeing the value in selecting a corporate trustee—typically a financial institution—for this important role. A corporate trust-ee can be a smart solution because such entities:

• Bring a level of expertise that individuals acting as trustee cannot offer, including investment manage-ment capabilities and management of special assets such as real estate and closely-held businesses.

• Take on all of the liability associ-ated with taking control of the assets contained in the trust, thus preventing family members from exposure to potential liability.

• Ensure trust funds are applied impartially among beneficiaries, based on the language of the trust document. A corporate trustee will not be swayed by the emotion of family dynamics,

ensuring that the grantor’s intentions will be carried out.

• Offer consistency and longev-ity that most family members cannot. Trust duties are not interrupted by family obligations, death or any other unforeseen circumstance that could prevent a family member from carry-ing out his or her duties.

So, as you think about whom to choose for successor trustee, carefully consider a corporate trustee to fill this role. It could save your family a great deal of heartache and ensure your wishes are carried out as you desire.

Disclosure: Wills, trusts, foundations and wealth planning strategies have legal, tax, accounting and other implications. Clients should consult a competent legal or tax adviser.

U N D E R S T A N D I N G T H E R O L E S I N A T R U S T

When navigating the topic of trusts, several different entities that play an important role are worth defining:

Grantor—the creator or owner of the trust. Only the grantor can make changes to his or her trust.

Trustee—the person or entity who manages the assets that are in the trust. Often the grantor chooses to be his or her own trustee.

Successor Trustee—the person named to step in and manage the trust when the trustee is no longer able to continue, usually due to incapacity or death.

Beneficiaries—the persons or organizations who will receive the trust assets after the grantor dies.

By Maricella Solorzano

The Private Bank, Union Bank, NA_WOR21.indd 106 11/15/12 3:47 PM

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What are some important considerations when choosing a successor trustee?

How to reach Maricella Solorzano

I welcome an introductory conversation and can be reached at 949.553.7177. I look forward to speaking with you.

The Private Bank, Union Bank, N.A. 18300 Von Karman Avenue, Suite 500, Irvine, CA 92612 949.553.7177The Private Bank, Union Bank, N.A. 18300 Von Karman Avenue, Suite 500, Irvine, CA 92612 949.553.7177The Private Bank, Union Bank, N.A. 18300 Von Karman Avenue, Suite 500, Irvine, CA 92612 949.553.7177

Financial Services Experience18 years

Minimum Fee for Initial Meeting None required

Assets Under Management: $16.7 billion (global)

Primary Custodian for Investor AssetsUnion Bank, N.A.

Minimum Net Worth Requirement $1 million (planning services); $1 million in assets (investment services)

Compensation MethodFixed, asset-based and hourly fees

Professional Services ProvidedPlanning, investment advisory, money management and trust and estate services

Website Email www.unionbank.com/private maricella.solorzano@unionbank.comwww.unionbank.com/private maricella.solorzano@unionbank.com

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“To help protect friends and family from this potential liability, more and more wealthy individuals are seeing the value of selecting a corporate trustee—typically a financial institution—for this important role.” —Maricella Solorzano

Maricella Solorzano is a vice president and senior trust officer at The Private Bank of Union Bank in Orange County, CA. Ms. Solorzano works with a team of specialists in wealth planning, investments, risk management, trust and estate services and banking. As a senior trust officer, she manages a wide range of trust and estate matters and offers extensive experience with testamentary and living trusts, charitable trusts and agency and custodial arrangements. Ms. Solorzano joined Union Bank in 2004 and has been in banking for over 18 years. Previously, she was vice president and trust officer at City National Bank. She received a BFA degree from California State University at Long Beach and is a graduate of the National Graduate Trust School at Northwestern University. She holds the professional designation of Certified Trust & Financial Advisor (CTFA).

About Maricella Solorzano

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Maricella Solorzano Vice President and Senior Trust Officer

The Private Bank, Union Bank, N.A. 18300 Von Karman Avenue, Suite 500

Irvine, CA 92612Tel. 949.553.7177

maricella.solorzano@unionbank.comwww.unionbank.com/private