Note: Each year that passes we are reminded of the following article that we published on our site several years ago but still holds its relevance today.

A RESOLUTION FOR YOUR NEW YEAR

By Joseph K. Presley

Most of us associate resolutions with the arrival of the New Year, but why not consider your own birthday, your new year, as a good time to resolve to review and update your estate planning? This is certainly one of the most important commitments that you can make to yourself and to your family. In most estate plans, there will be a need for a trust and a need to appoint a Trustee. I thought I would outline a few thoughts and questions for your consideration as you undergo the planning process.

First of all, let's consider whom you would name as a Trustee of any trusts that will be created as a result of the overall planning. Are you currently working with an investment advisor? If you are, then you want to use a Trustee that will provide the flexibility to enable your family to continue working with your advisor. Were you aware that most corporate trustees want to manage the assets in the trust and would immediately eliminate any ties to the financial advisors you have worked with for years?

Our clients feel that when a Trustee manages money there is inherent conflict of interest. They will never fire themselves if their investment performance is poor. Nor will they suggest other alternatives that offer better investment performance. Is a portfolio manager in a trust department better able to deliver top investment performance year after year compared to the best money managers in the country? I don't think so. What about a trustee who uses his or her own mutual funds? Does that feel like a conflict to you?

Why use a corporate trustee such as Cumberland Trust? Why not appoint a family member or friend? If you have ever served as Executor or Trustee, you already know the answer - most family members don't have the time. If they do have the time, they don't have the expertise. If you have more than one family member, whom do you appoint? Is it right to have one child determine what is best for the other siblings? What if your family is a "blended" family ("his, hers, and ours? Is the surviving spouse protected from any decisions that are made?

If something goes wrong in the trust, is the family member protected from liability? Probably not, and they can't obtain insurance to cover their liability. Most attorneys won't serve as executors or trustees because of the liability, so why would an individual family member want to serve alone? Some families appoint a corporate co-trustee or co-executor along with a family member as a solution.

Think of it this way: You've worked so hard to promote family harmony. Why let the family harmony be destroyed after you are gone?

If you want to maintain harmony, appoint Cumberland Trust. We have many years of experience working with families and we have individuals on staff that have the expertise to carry on your affairs they way you wish.

If you want your family to use your trusted advisors, from your attorney to your financial advisor and CPA, appoint Cumberland Trust. You have spent years cultivating these types of relationships. Why would you allow them to be severed just because you appointed the wrong trustee?

So as your birthday arrives, make this commitment. Take the time. You owe it to yourself and your family. It's painless if you know where to turn. We would love to help you with this commitment. Please call us at 615-783-2540 or visit our website, www.cumberlandtrust.com. I hope you have a terrific year!

Joseph K. Presley is President and CEO of Cumberland Trust & Investment Company.

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