Trustee Fees for Trust Administration in Missouri…

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Trustee Fees for Trust Administration in Missouri…


               A trustee is a fiduciary named in a trust to manage assets for the benefit of trust beneficiaries.  Serving as a trustee is a lot of work and our firm assists trustees in Missouri with administering trusts, including special needs trusts and spendthrift trusts.  The question of how much a trustee should be paid for their services is very common.

First, the trust document itself should provide a standard for setting fees or sometimes (increasingly rare) will just state how much the trustee should receive each year.  I counsel all of my clients to remember that if you want your trustee to accept the role, and all the responsibility it entails, you don’t want to be cheap when it comes to deciding their fee to serve.

That’s why I normally recommend language in the document stating that the trustee fee should be a “reasonable fee based on the time and effort” of the trustee.   This language is intentionally broad to allow for any number of circumstances.  As an example, say you pass away and the trustee you named, your brother agrees to serve but lives out of state.  If he has to fly in a few time a year to meet with the beneficiaries, the loss of his time should be considered in his fee and obviously his reasonable travel expenses will definitely be paid out of trust funds.  However, if the trust principal is managed by a financial advisor, he hires an attorney to advise him on managing the trust and has an account prepare the trust tax return (as they should if they are not an accountant), then those professionals will also charge a fee for their services.  It also means the trustee has spent less time in his duties.

Providing for a specific fee amount or percentage of the trust estate is not something I usually recommend to clients.  The reason is simple.  If you say that your trustee gets $5,000.00 per year and pass away with $2 million in trust assets, that is a pretty small fee and likely to cause your chosen trustee not to serve.  Well, if they won’t serve, there’s a chance your alternate successor trustees won’t serve either.  You could end up with no one being able to serve.  In that case, someone, probably a beneficiary, would have to file a court case in Missouri to have a trustee appointed.  This is not only a waste of money but easily avoidable.  If you must have a concrete fee figure stated in your trust, I recommend a percentage.  Corporate trustees usually work on a percentage fee basis and it’s not a bad idea because it accounts for differences in the size of the trust estate.  If there’s more assets to be managed, the fee would be higher but there’d be more to do.  If less assets, the reverse would be true.

Missouri does have a statute related to compensation of a trustee, which is RSMo. 456.7-708.1.

Here is the link:

The statute provides that compensation is governed by the trust document but if not mentioned then the fee is entitled to compensation that is “reasonable under the circumstances”.  There’s that “reasonable” word again.  The statute further provides that a court may increase or decrease the fee specified by the trust document if it would be unreasonably high or low.

If you’re putting together a trust I first commend your for taking proactive steps to protect your family and your assets.  Just make sure to treat your trustees fairly too.