After all the rigmarole, there were cracks in the egg. The couple's differences in lifestyle and vigor started to create strain, says Parr (the father needed a caretaker for the most part). Within three years, they had filed for divorce. So that they could part on amicable terms, the father promised his new wife a large settlement figure without talking to Parr or an accountant, which triggered a huge gross IRA distribution that, with taxes and penalties, turned the lump $150,000 settlement into something much larger. On the other hand, the children were again named per stirpes beneficiaries of the IRA at 25% apiece.

The client went into an assisted living facility and the financially responsible daughter was again named as the successor. He resigned as trustee when his mental state started to deteriorate beyond repair. Parr currently deals with the daughter.

Now in a retirement home, the client recently got a new girlfriend.

"Our firm is thinking of adding a full suite of concierge services that include sending a 'Guido' for a personal visit to put big cement boots on the client if he expresses any thoughts of remarriage," says Parr.

Though many times, family members are chosen as trustees and it all works out, Parr says that these are cases when corporate trustees can help. Though it's no sin to keep it simple by hiring a family member who is competent, sometimes a trust company can help when the bookkeeping and accounting is getting too complicated and a referee is necessary for squabbling family members.

It's expected that financial advisors will increasingly be taking leadership positions in these situations as more baby boomers retire and more assets go into trusts, and many advisors will have to make a decision about which trustee firms to work with. Some are opting to start their own.

Harrison says that when a successor trustee steps into the fold, hopefully there is an AB trust or bypass trust that is there for the kids that can't be changed.

"If you have an AB trust, that will at least keep [someone new] from taking all the money," she says. "I have seen a situation where the second wife might favor her own children over the children of the deceased spouse. And it's legal. If she is the successor trustee, she can do what she darn wants to if it's not been set up properly."

Sometimes there can be trouble if a child awaiting a lot of trust assets is being cared for by someone who is not as financially well off. Harrison has a situation in which her client has set up a trust for a grandchild who is in a foster home and is likely going to be adopted by the foster family. "At [the client's] death, there will be a special trust set up for this grandson, and the attorney's trust department or the attorney's trust administration department will be administering it. I would want to keep control of who is controlling that money, because as good as this foster family is, they also have other children and I'd want to make sure that this money would benefit the person it's intended for. The whole idea is that this money is supposed to go for education."

Altman says that, again, it's do-it-yourselfers and lawyers who don't listen carefully and find out what a client really wants that leads to trouble. He says he's seen three different trust documents from three different lawyers in three different states in which there is no successor trustee named if the trustee dies and no method of appointing one.
"There are a tremendous number of ways that it can get screwed up, and generally it's because the person who was writing the document doesn't get all the possible contingencies, possibilities or someone doesn't listen, doesn't know.