Picking the person or institution that will oversee your trust is not something to rush. The right trustee keeps family disagreements to a minimum, files taxes on time, and adheres to the trust’s terms to the letter.
At Woods & Bates, P.C., we guide Illinois families through every stage of estate and trust work, so we have seen what happens when this single choice goes well and when it goes off track. This article shares clear rules, practical tips, and common pitfalls so you can nominate a trustee with confidence.
What a Trustee Does in Illinois
A trustee controls and protects the property titled to the trust, both during your lifetime and after your passing. This includes paying bills, investing funds, filing tax returns, and distributing money to beneficiaries in accordance with the trust’s terms.
Illinois has adopted the Illinois Trust Code, which lays out a “fiduciary” duty of care. In short, the trustee must:
- Put the beneficiaries’ best interests first.
- Invest prudently, following the prudent investor rule.
- Avoid any self-dealing or favoritism.
Courts take these duties seriously—trustees who ignore them risk removal and personal liability. Understanding the weight of the job helps you decide who is genuinely up for it.
Trustee Eligibility: Who Can Serve?
The law gives grantors broad freedom to name almost anyone, but a few basic rules apply. A potential trustee must:
- Be at least 18 years old.
- Be mentally competent.
- There is no serious conflict with the trust’s goals or its beneficiaries.
Beyond those minimal guards, you may appoint family, friends, advisers, or a bank. That freedom is both a gift and a trap because it is easy to choose a beloved relative who is not prepared for record-keeping, tax work, or beneficiary tension. Thinking past the legal floor to real-world skill sets is critical.
Who Should NOT Serve as Trustee: Disqualifications and Considerations
Some candidates look fine on paper but create headaches once the trust becomes active. The following groups deserve closer scrutiny.
Grantor as Trustee
Acting as trustee of your revocable living trust is common and usually harmless. With an irrevocable trust, though, retaining control can undercut tax or long-term care goals. If you keep the power to decide distributions, the IRS or Medicaid could treat the assets as still yours.
Beneficiary as Trustee
A beneficiary who also serves as a trustee may inadvertently favor their interests. If you have multiple children, naming one child as trustee can make every distribution feel personal to the others. A neutral third-party or co-trustee arrangement often keeps family peace.
Individuals Lacking Necessary Skills
The trustee’s job is part accountant, part investment overseer, and part referee. Lacking any of these can slow administration or trigger legal trouble. Key capabilities include:
- Basic financial sense to read statements and hire professionals when needed.
- Accurate record-keeping ensures that every dollar is accounted for.
- Soft skills to answer beneficiary questions calmly.
If your first-choice person does not bring these strengths, require that they retain a CPA, investment adviser, or both.
Individuals with Potential Conflicts of Interest
Sometimes, a close business partner, new spouse, or longtime friend may have interests that clash with those of a beneficiary. Even the appearance of conflict invites lawsuits. When loyalty is divided, consider appointing someone else or adding a co-trustee who balances the scales.
Individual vs. Institutional Trustees
After screening people, you still face the question of naming a person or a professional institution. Each path carries trade-offs.
Below is a side-by-side summary to help you compare.
| Feature | Individual Trustee | Institutional Trustee |
| Personal touch | High knows family history | Low, but consistent service |
| Professional resources | Must outsource tax and investment work | In-house accountants and portfolio teams |
| Fee structure | Often lower or even waived | Percentage of assets, minimums apply |
| Longevity | Limited by the trustee’s lifespan | Perpetual existence |
| Impartiality | May favor certain heirs | Follows written terms strictly |
Many families start with a trusted person as the first trustee and name a bank or trust company as the backup. This hybrid model blends personal insight with professional continuity.
Key Factors to Consider When Selecting a Trustee
Once you understand the broad categories, drill down into specific traits. Evaluating each candidate through these lenses can prevent costly surprises.
- Judgment. Will the trustee interpret “health, education, maintenance, and support” the way you would?
- Availability. A trustee should have enough time to answer calls, sign forms, and review statements.
- Location. Proximity to Illinois property or courts simplifies tasks, though virtual tools help bridge gaps.
- Longevity. A younger co-trustee or corporate backup protects against early vacancy.
- Impartiality. Look for someone viewed as fair by all beneficiaries.
- Interpersonal Skills. Clear, calm communication heads off disputes.
- Attention to Detail. Every receipt, tax slip, and bank statement must be stored and made available for sharing.
- Insurance. Errors and omissions coverage shields the trustee and, indirectly, your heirs.
- Investment Experience. Helpful but not vital if the trustee agrees in writing to hire a qualified adviser.
Rank each prospect against these traits. A simple scorecard clarifies who truly fits the mission.
The Importance of Successor Trustees
Your first choice may decline, move, or pass away. Illinois law allows beneficiaries to seek a court-appointed replacement, but that delays distributions and increases fees. Naming at least one, and preferably two, successor trustees ensures the plan continues to run smoothly.
Many grantors list a reliable person first and a corporate trustee as trustee of last resort. That safety net helps beneficiaries avoid an emergency court petition if every individual on the list is unavailable.
Need Help Choosing the Right Trustee? Let’s Talk
Trustee selection is only one piece of a well-built estate strategy. Woods & Bates, P.C., works with Illinois families to draft clear trust language, counsel nominated trustees, and handle the accounting that follows. Whether you’re updating an old plan or starting fresh, you can rely on our decades of focused experience.
Questions about your trustee list? Please call us at 217.735.1234 or contact us through our Contact Us page. A short conversation today can spare your loved ones years of confusion tomorrow.
