You recently found out you are the trustee to your parent’s trust. It is very likely that during the next few months you will feel extreme family pressures from your siblings to ‘give them their money.’ We know it all too well.
Many families have a very difficult time coping with their emotions during this time period. It is not uncommon for the trustee to be blamed for how long it is taking and being told they are not seeing it as a priority. If the trustee does not adequately communicate, the beneficiaries of the trust (possibly your siblings) may decide that the trustee is stealing their parent’s money and keeping it for themselves. In the worst cases, siblings sue the trustee sibling as a way to put additional pressure on them to get it done!
To avoid being in this situation with your siblings, we recommend you frequently and proactively communicate with them. We have put together 3 recommendations on how to communicate with your siblings to help manage their emotions and diffuse the situation of getting sued.
1. Give Frequent Written Updates
Write letters, emails, or group texts, and be sure to contact your siblings to let them know what is going on. Everything significant such as putting the house up for sale to small progress updates like leaving a voicemail to your tax attorney. Any information you can share is valuable to them. We recommend sending them a written update on a weekly or bi-weekly basis to make them feel involved. If there is no news to share, communicate that and set their expectations on when you will reach out next.
2. Ask For Their Opinion
When you ask your siblings for their “insights,” they feel involved and will be less likely to suspect you of making irresponsible decisions that don’t have their best interest in mind. For example, before selecting the CPA who will assist with your parent’s finances, give your siblings a call to discuss the options. Say you have it narrowed down to two professionals, explain the pros and cons of both and have them weigh-in on who you chose to work with. At the end the day the decision is still yours since you are the trustee of the trust. However, just by offering the opportunity to give their opinion you have gained their respect.
3.Run All Major Decisions by Them
The most significant decisions, such as taking an offer made on the house, are the most critical to run by the other beneficiaries. We often see that when the trustee makes these important decisions alone, that is when the other siblings consider suing. Why? Because the amount you sell the house for will directly impact the money they get from the trust to further their own family affairs. Instead of announcing you took an offer on the house, share “we got an offer, and I am thinking about taking it for the following reasons,” and allow them the opportunity to express their feedback. Always allow a grace period of a day to see their replies, before announcing – “we accepted the offer on the house.” Even though they may not like your decision, they did have a window of time in which they could have done something to convince you otherwise.
Just like everyone else in the family, you need time to grieve. The pressure you will undoubtedly feel from your family to get everything done will not be easy. We understand that and are here to support you in any way we can.
Contact us if you have more questions about how to communicate with your siblings or would like our assistance with finalizing your parent’s trust.