Directed Trusts, only available in a handful of states across the country, including South Dakota, have drastically changed the trust world by putting control back into the hands of settlors, beneficiaries, and their advisors. Through bifurcating liability, the directed trust model creates a legal framework allowing trustees and beneficiaries to work with asset managers and independent trust companies of their choosing.
The directed trust concept:
- Unbundles functions (asset management and trust services) that have been and are traditionally bundled together by large bank-based corporate trustees.
- Provides a family with maximum flexibility and control regarding the trust’s asset allocation, diversification, investment management, and distributions. This is particularly ideal for a settlor who wants to fund an irrevocable trust with a closely held company or a specialized asset, while maintaining control.
- Allows the settlor to appoint an administrative trustee of their choosing and to appoint a trust advisor or an investment trustee/committee, who in turn may select outside investment advisor(s) and/or manager(s) to manage the trust’s investments.
South Dakota’s directed trust statute has been recognized as among the best in the nation. As a South Dakota chartered trust company, Bridgeford Trust can work collaboratively with clients and their long-time trusted advisors while delivering industry leading fiduciary capabilities.
Click here for a detailed discussion around how the directed trust concept works to empower settlors, beneficiaries, and their advisors while revolutionizing the trust and wealth management industry. You can also read about Bridgeford Trust’s extensive work in the directed rrust space in an article that appeared in Worth Magazine here.
For resources on this topic and other progressive modern trust law concepts, be sure to visit Bridgeford Trust’s YouTube channel. And of course, please contact Bridgeford Trust via our contact page if you have questions.
