Dear Readers, This column was originally published in 2017. I have received questions about the professional fiduciary field so I am rerunning this column with a few updates. Enjoy!

“A professional fiduciary could easily spend all day simply complying with the rules. To do so, however, would be to miss the forest for the trees because trustees have a higher calling, a duty to their beneficiaries that far exceeds the regulatory and legal responsibilities,” Gail E. Cohen, vice chairman and general counsel, Fiduciary Trust Company.

Many families use trust agreements to pass wealth from generation to generation. When spouses are involved, tax planning can be a motivation to use a trust but many times property is held in trust so that a child or other heir who may not be ready to manage money does not get a huge amount of assets dumped in their lap and go on to waste or lose those assets. Over the years, we have seen “trust babies” — Paris Hilton, for example — act out and misbehave believing that the silver spoon in their mouth entitles them to treat others (and themselves in the process) as less-than.

Most of the time, parents, uncles and grandparents are well intentioned in setting up trusts for heirs seeking to help a child with educational expenses, a down payment for a first home or funds to start a business. These are all excellent ways to encourage a child to better themselves.

The rub is — who is going to administer the trust? Do parents really want a sibling to be the “overlord” of the other — mandating the production of school transcripts or a viable business plan in order to be given support? History shows that it is rarely a good idea to have an adult child, friend or other relatively inexperienced trustee in a position where “a trustee’s discretion” must be used to make sure the intentions of Mom and Dad are carried out properly. As a result, the professional fiduciary is born. Bank trust departments have historically been the only professional trustees but more and more individuals are becoming fiduciaries as their chosen profession. In 2006, the Professional Fiduciaries Act was enacted and California began regulating the fiduciary profession.But why? One litigation attorney warned me that, “As a professional fiduciary, you walk around with a target on your back.” The job is technical and there are many ways to err, but another contributing factor can be the resentment of the heir. Many trust beneficiaries are angry and, instead of seeing the trust as a gift, they perceive the trustee as controlling their money and therefore limiting their happiness. Until a beneficiary grows out of such a perception, the trustee can be the target of aggression, ridicule and, often, lawsuits. They kill the messenger.

Sometimes a professional fiduciary is the only and best choice. A son is married to a woman you distrust? Leave his assets in trust and have the experienced trustee fend off the divorce lawyers. A daughter that could be easily taken advantage of? Who better than a stern fiduciary to help her stay out of another’s crosshairs?

Trust agreements are, at their essence, relationships framed by a legal structure but, is a trustee really one that is drawn to a higher calling? That seems a bit self-aggrandizing. Passionate and committed to a profession that is helpful to many but resented by some may be more accurate.

Liza Horvath has over 30 years of experience in the estate planning and trust fields and is a licensed professional fiduciary. Horvath currently serves as president of Monterey Trust Management. This is not intended to be legal or tax advice. If you have questions call (831) 646-5262 or email liza@montereytrust.com