How to Choose a Trustee in Florida: Key Factors to Consider

When you create a revocable living trust or any other type of trust in Florida, one of the most consequential decisions you will make is choosing your trustee. The trustee is the person or institution responsible for managing trust assets, making investment decisions, handling distributions to beneficiaries, and ensuring the terms of the trust are followed. A poor choice can lead to family conflict, financial mismanagement, or even litigation.

Understanding the Trustee's Role

A trustee in Florida has significant legal responsibilities under Florida Trust Code (Chapter 736). These duties include:

• Duty of Loyalty: The trustee must administer the trust solely in the interest of the beneficiaries, not for the trustee's own benefit.
• Duty of Impartiality: If there are multiple beneficiaries, the trustee must treat them fairly and impartially.
• Duty of Prudent Administration: The trustee must manage trust assets as a prudent investor would, considering risk tolerance, diversification, and the purposes of the trust.
• Duty to Keep Records and Report: Florida law requires trustees to maintain adequate records and provide accountings to beneficiaries.
• Duty to Distribute: The trustee must follow the trust's distribution provisions and make timely distributions to beneficiaries.

  Failing to meet these duties can expose the trustee to personal liability.

  Individual Trustee vs. Corporate Trustee

  Individual Trustee (Family Member or Friend)

  Many people name a spouse, adult child, or trusted friend as trustee. The advantages include:

  • Personal knowledge of the family and the grantor's intentions
  • No fees or lower fees than a corporate trustee
  • Accessibility and personal relationship with beneficiaries
  • Flexibility in day-to-day decision-making

    However, individual trustees may lack investment expertise, may be overwhelmed by the administrative burden, and can face conflicts of interest—especially if they are also a beneficiary.

    Corporate Trustee (Bank or Trust Company)

    A corporate trustee is a professional institution that specializes in trust administration. Benefits include:

    • Professional investment management and fiduciary expertise
    • Continuity—a corporate trustee does not become incapacitated or die
    • Objectivity in making distribution decisions, particularly when beneficiaries disagree
    • Compliance expertise with tax filings, record-keeping, and regulatory requirements

      The primary drawbacks are cost (corporate trustee fees typically range from 0.5% to 1.5% of trust assets annually) and a potentially impersonal relationship with beneficiaries.

      Qualities to Look for in a Trustee

      Regardless of whether you choose an individual or corporate trustee, look for these qualities:

      • Integrity and trustworthiness: This is non-negotiable. The trustee will have control over your assets.
      • Financial competence: The trustee should understand basic investment principles and financial management.
      • Availability and willingness: Serving as trustee requires time and effort. Make sure your chosen trustee is willing and able to take on the responsibility.
      • Good judgment: The trustee will need to make discretionary decisions about distributions, investments, and administration.
      • Ability to work with beneficiaries: The trustee should be someone who can communicate effectively and manage relationships, even in difficult situations.

        Naming Successor Trustees

        Your trust should always name at least one successor trustee who can step in if your primary trustee is unable or unwilling to serve. Consider naming multiple successors in order of priority. Without a successor, the court may need to appoint one, which adds cost and delay.

        A common approach is to name yourself as initial trustee, your spouse as first successor, an adult child or trusted friend as second successor, and a corporate trustee as the final backup.

        Florida-Specific Considerations

        Florida law allows both residents and non-residents to serve as individual trustees. However, there are practical considerations:

        • A Florida-based trustee may be more accessible for handling local real estate, banking, and court matters.
        • Florida does not impose a state income tax on trusts administered by Florida trustees, which can be advantageous.
        • If your trust holds Florida homestead property, the trustee must understand Florida homestead law and its restrictions on transfer.

          Co-Trustees: Sharing the Responsibility

          You may consider naming co-trustees who serve together. For example, you might name an adult child and a corporate trustee to serve jointly—the child brings family knowledge while the corporate trustee provides professional expertise. However, co-trustees must agree on decisions, which can create delays or disputes if they disagree.

          Review Your Trustee Selection Regularly

          Life circumstances change. The person you named as trustee five years ago may no longer be the best choice due to health issues, relocation, changed relationships, or other factors. Review your trustee designations periodically and update your trust as needed.

          Contact our office to discuss trustee selection and ensure your trust is set up for long-term success.