A family member left my son some money in an inheritance with some stipulations on what he can use the money for (education, living expenses, etc). The trust assigned a financial advisor but so far has been difficult to work with. What are our options for changing advisors? Can it be done?
Scott:
The first step is to consult iwth somone who is familiar with trust planning and trust documents. The spending needs you describe sound like a "HEMS" clause (health, education maintnance and support) but until the trust is analyzed for the direct wishes of the decedent, it is hard to comment on what is allowable, and what is not. I have been involved in the planning of hundreds of trust documents, and they vary greatly depending on the wishes of the trust grantor. Additionally, the wording of the assignment of the advisor is key in if they can be changed. The Trustee is responsible for the running of the trust- they need to be consulted, as well as a trust attorney. IF you like, you can contact me and I can take you through the steps necessary to find out what your rights are. Remember, as should the advisor and trustee, that the trust is for the benefit of your son and should act accordingly with careful decisions and a fair heart.
You can move the account to another financial advisor. Make sure that the trust account at the new firm is established properly and that the advisor works with trust accounts. When establishing a trust account, the trust document must be referred to when answering specific questions unique to the trust. Interview a couple advisors to see who has the proper knowledge and personality for your situations.
Scott:
If the document is an irrevocable trust and it specifically names a particular advisor, you cannot change the advisor for no cause. To remove an advisor from an irrevocable trust who has shown no cause for removal other than being hard to work with, you would have to go to the courts to petition a judge to rule that there is a reason for removal ie: breach of fiduciary duty, theft, etc. If the trust does not specifically name a financial advisor, it is up to the trustee to assign another. As I noted above, without a reading of the trust, this conversation is for informational purposes only.
