Many wealthy families use trusts for their estate planning, but as the regulation and complexity of investments increase, an information gap has developed between those involved with trusts and facts on the ground.
Earlier this year, Family Office Exchange set about trying to close that gap at the request of two of its largest family office members who said they wanted education for their trustees, but had been unable to find programs to provide it, according to Marvin Pollack, FOX’s managing director for marketing and strategy.
The organization conducted a sold-out workshop on trusts in New York in June, and has scheduled a second one in San Francisco for Nov. 29–30.
The majority of participants in the New York event were family office executives and staff members, along with a good number of family members, Pollack said. More than half identified themselves as trustees, and upward of a third said they were either lawyers or CPAs.
Pollack noted that the need for education was on full display during the New York workshop. Family members who were grantors were trying to determine which made most sense for them: a personal trustee, a corporate one or a personal trust company. This turns out not to be a simple matter, especially for those with complex wealth holdings, he said.
A personal trustee who performs poorly can generate hard feelings among relatives or close friends or, worse, prompt a lawsuit. Moreover, identifying someone with both the technical skills to manage investments and the emotional closeness with the grantor can be challenging.