If the situation and relationship dynamics allow, I generally advise clients that want to choose co-trustees to administer their trust to allow them to act independent of one another. That way, the co-trustees can determine who should handle each task and work more efficiently. They can divide and conquer the tasks of selling real estate, distributing personal property, managing financial assets, paying bills, and ultimately pass the assets along to the trust beneficiaries.
There are situations that warrant co-trustees acting together on each piece of the trust administration process. The most common family scenario where co-trustees acting together is crucial occurs in a blended family where each spouse has children from a previous relationship. In these situations, each spouse may create their own trust that becomes irrevocable upon their death. They may name one of their biological children as co-trustee with the spouse that survives. That way there is a balance of interests for the spouse who is meant to be supported and benefit from the trust but also for the children of the deceased person who will ultimately benefit once that surviving spouse dies.
It is also not uncommon for married couples that have children together to require co-trustees act when the first one of them dies. The co-trustees being the surviving spouse and one of their children. This decision is gaining popularity as some families have seen assets disappear after the first spouse dies. People can enter the life of the surviving spouse and have influence over them, take advantage of cognitive deterioration, and ultimately financially benefit with the kids of that surviving spouse receiving nothing. A way to combat this situation is to name the surviving spouse and child as co-trustees. Requiring them to act together on paying bills and accessing funds for the benefit of the survivor can ensure that money supports the surviving spouse and then ultimately goes to the children of those two persons.
Choosing co-trustees to act together offers protection and comfort that your wishes will be honored. Unfortunately, it is becoming common for financial institutions to not accept trusts where co-trustees must act together. It is desirable from the perspective of a bank or financial company to authorize co-trustees to act separately. That way there is no policing of whether both trustees have consented to withdrawing money, paying a bill, or making a particular investment decision. It is just difficult for big institutions to enforce and monitor these situations.
Requiring co-trustees to act together is sometimes necessary to ensure a successful administration of a trust. This choice must be carefully made as the refusal to honor co-trustee situations is on the rise.