What are the duties of a trustee?

A trustee is a person or corporation chosen to protect the assets of another person. In the state of Texas, a trustee has several critical duties. First, the trustee must act in good faith and in the best interests of the beneficiary, or the individual for whom the trust was created. This means that all decisions the trustee makes must be to help the beneficiary in some way. Second, the trustee must be loyal to the beneficiary, meaning they should not use their position to benefit themselves directly or indirectly. This includes not taking advantage of insider information to invest in assets or making money for themselves, not taking personal loans or gifts from the trust, and not using the trust to increase their own wealth. Third, a trustee must understand his/her fiduciary duties – the legal obligations that come with the position. These duties put the needs of the trust and beneficiary above the needs and interests of the trustee. This includes understanding the trust document, keeping the assets of the trust separate from those of the trustee, and investing the assets in a safe and profitable way. Finally, the trustee should keep meticulous records of the investments and decisions made, as well as submitting regular reports to the beneficiary or court. This ensures that the trustee is taking his/her duties seriously and is managing the trust’s assets responsibly. Failure to fulfill any of these duties may result in legal action being taken, so it is important for any trustee in Texas to understand and properly fulfill their obligations.

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