Are Family Members Overcharging for Serving as Trustees of $30 Million Trust?
There are 4 brother and sisters – 2 of them are the trustees of a $30 million estate. They are paying themselves $175,000 each per year, but pay others to do all the work around administering the estate. Do I as a beneficiary have any rights about what they pay themselves or how they are handling the estate? They are not divulging any information easily. What is reasonable pay for them to pay themselves out of the trust?
This is a very large trust. Together their fees appear to total $350,000 a year, which is just over 1% of the trust estate. This seems high given both the value of the trust estate and the other costs to which you allude. Over time, it could erode the value of the trust and thus may be a violation of the trustees’ fiduciary duty to all the beneficiaries. As a beneficiary, you have the right to significant information about the trust. I would recommend that you retain counsel to review the situation and advise you accordingly.