Corporate trustees are departments at banks or other investment firms hired to build and manage a trust. People hire corporate trustees for their professional experience in trust matters that a family member or friend may not have. Corporate trustees can help build a trust that better reflects the creator’s intentions, and unlike personal trustees, corporate trustees are mostly impartial actors bound by fiduciary duties to follow the creator’s intentions. Corporate trustees are usually paid between .5% - 2% annually of the trust’s assets, and while costly, paying trustees by percentage encourages them to increase the income of the trust and therefore their pay. Family members or friends may have personal feelings or interests guiding their actions as trustees, though often less expensive.
[Last updated in June of 2021 by the Wex Definitions Team]