What It Means to Be an Advisor-Friendly Trust Company

July 8, 2024

Being an advisor-friendly trust company is about creating a positive relationship for all involved parties. In the directed trust area, the bifurcation of roles has the potential to create a disjointed trust administration. However, an experienced directed trustee knows how to be a good teammate to the advisor and can help make the administration seamless for the client. 

The key things to think about when looking for an advisor-friendly trust company include: (1) being a trusted partner, (2) the ability to educate families and team members, (3) having a solution-oriented approach to trust administration, and (4) having a customer focused perspective.

Trusted Partner

A partner is defined as “a person or organization you are closely involved with in some way” or whom you are “engaged together [with] in the same activity.” In the trust administration context, it is no different. A good partner is one with whom you share honesty, trust, respect and open communication. Finding the right partner is an art, made up of key elements which work together to create greater value. Some of the key elements to identifying a successful trust company partner include:

  1. A company with a complimentary service offering (such as a directed trustee), where there is no fear of competition for business.
  2. A reputation of good service and professionalism amongst their peers and other professionals.
  3. Longevity in the business, which not only evidences good service, but also practical knowledge gleaned from years of experience.
  4. Expertise in trust administration and an understanding of planning which can allow the trustee to offer solutions and prevent inadvertent planning issues.
  5. A company with high standards for its performance expectations, subject to periodic regulatory review and oversight.
  6. A company that recognizes one size does not fit all and offers customizable pricing.

Educating Families and Teammates

Another key aspect is the ability to rely on your trust company partner to provide on-going, quality education to both your team and the families that you serve. Trust planning can be a very technical area of the law, with lots of complex requirements and administrative nuances. Having someone who can simplify the process and speak in ways that engage families is important. Making administration streamlined and being able to explain things in an understandable manner is essential. An advisor-friendly trust company does this as a matter of course, working closely with the advisor to ensure the family is making informed decisions.

The current shift in focus within the estate planning community to transparency within family units is important to consider as well. Families are realizing that one of the benefits of early beneficiary education (over silent trusts) is beneficiary engagement. Choosing an experienced fiduciary partner, with educational resources available to the families that you work with is becoming an essential part of client retention. A good corporate trustee can help families communicate the goals that they hope to achieve with their wealth, the role each family member will play in the same, and the need for trust planning. 

In addition, a good fiduciary partner can provide educational opportunities for your team regarding trust planning basics, trust administration, and the ins and outs of partnering with them. This can be done through in-person meetings or webinars. Building knowledge within your team and allowing regular interaction with your corporate trustee partner can help strengthen the relationship and improve communication both amongst the team and with your client families.

Solution-Oriented Trust Administration

While it would be nice if you were able to do anything that you want when administering a trust, it is important that any trust company that you work with diligently enforces the terms of the trust. This sounds limiting; however, with the right partner it does not have to be. Having a knowledgeable partner, with in-house experts means that while you may not always get a “yes” every time, you will likely get at least a “no but,” followed by a creative way to achieve the desired goal. You can take comfort in the fact that you have a teammate working with you to accomplish your client’s goals within the confines of the plan. If a no is required in the end, it will only be after every avenue has been exhausted.

The ability to rely on years of experience administering Delaware trusts means that your corporate trustee has likely already seen and solved any issues that arise. Add to that a trustee which has knowledge of the ins and outs of state law, participates in the drafting of that legislation, and is able to help you navigate the same; the result is protection for your client. Specialized trust companies with a solution-oriented mindset can also add a nimbleness in decision making and flexibility that larger companies cannot.

What a Customer-Focused Perspective Looks Like

An advisor-friendly trustee will also assign a dedicated trust officer team to the administration of each trust. There will always be someone familiar with the family, its specific needs and dynamics, available to assist. In companies like Commonwealth, this is not only true of your client’s trust officer, but also the trust’s in-house trust counsel, accountant, and tax professional. Working with a dedicated team means faster turnaround times, a smoother process, and early issue detection and resolution. 

For advisors looking for a reliable trust company partner, consider Commonwealth. With 93 years of experience as Delaware’s leading independent trust company, we specialize in Delaware directed trusts. Our proactive, solution-oriented approach ensures successful, long-term partnerships. Contact us to explore how we can assist you in serving your clients.

Commonwealth Trust Company is pleased to provide this article as a guide. Commonwealth Trust Company is not engaged in the practice of law and is not providing legal advice by the provision of these materials. Commonwealth Trust Company recommends that clients seek the opinion of their attorney regarding the specific legal and tax issues addressed in this article.