Many estate plans include trusts that take effect after death. With any type of trust, it’s up to the trustee to make decisions on distributions to the trust beneficiaries–the loved ones you want to provide for.
However, sometimes problems arise between the beneficiaries and the trustees. Often the reason is simple poor chemistry or misunderstandings between them, but there can be other issues as well. Beneficiaries may consider the trustee too slow to respond to requests for distributions to pay for legitimate expenses—such as college tuition, for example—causing a financial hardship on the beneficiary. The trustee may have a more restrictive view than the beneficiary of what is a legitimate expense.
If you don’t want your beneficiaries to be locked into a trustee, you can specifically give them replacement powers when you create a trust. These replacement provisions may contain certain requirements. They might state, for example, that the replacement trustee must be a bank, or a corporate trustee.
Without such a power, your loved ones might be locked in to a situation you did not intend. With some removal powers, your beneficiary may receive more attentive service from a trustee, who’ll know that a replacement is possible.