Does Your Client's Estate Plan Include an Outside Investment Advisor?

 Although it took effect in 2013, the new Illinois Directed Trust Statute (760 ILCS 16.3 and 16.7) has not been widely used. It may well be one that attorneys should seriously consider. 

As the number of corporate fiduciaries willing to delegate investment responsibility continues to decline, the number of families wanting to retain the services of a third party investment manager seems to be holding steady if not actually growing. A discussion about the inclusion of directed trust provisions in those family's estate planning documents might be prudent. For those estate plans already created, it could be worth a discussion with your clients regarding their continued desire to use a third party investment manager and the possible benefit of an amendment adding the directed trust provisions.

It is important to note that although some independent advisors or small RIAs will agree to serve as an Investment Advisor under the terms of a directed trust, most large financial institutions will not.  Nor will they allow their employees to be named directly.  If your client is currently working with a large financial institution, he or she may want to name a family member or trusted friend as the Investment Advisor and instruct him or her to hire the specific advisor or institution. 

If you would like to discuss your client's desire to have a corporate trustee but retain the use of his or her current investment advisor, please feel free to contact us at any time.